ALCAN Stock Volatility

ALCAN INC Stock Volatility Analysis

Volatility refers to the frequency at which ALCAN INC stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with ALCAN INC's price changes. Investors will then calculate the volatility of ALCAN INC's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of ALCAN INC's volatility:

Historical Volatility

This type of stock volatility measures ALCAN INC's fluctuations based on previous trends. It's commonly used to predict ALCAN INC's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for ALCAN INC's current market price. This means that the stock will return to its initially predicted market price.
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ALCAN INC Projected Return Density Against Market

Considering the 90-day investment horizon ALCAN INC has a beta that is very close to zero . This suggests the returns on DOW and ALCAN INC do not appear to be sensitive.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to ALCAN INC or Steel Works Etc sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that ALCAN INC stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a ALCAN stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
It does not look like the company alpha can have any bearing on the current equity valuation.
   Predicted Return Density   
       Returns  
ALCAN INC's volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how ALCAN INC stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Company's Stock Price Volatility?

Several factors can influence a company's stock volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

ALCAN INC Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to ALCAN INC or Steel Works Etc sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that ALCAN INC stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a ALCAN stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Considering the 90-day investment horizon the coefficient of variation of ALCAN INC is 0.0. The daily returns are distributed with a variance of 0.0 and standard deviation of 0.0. The mean deviation of ALCAN INC is currently at 0.0. For similar time horizon, the selected benchmark (DOW) has volatility of 1.27
α
Alpha over DOW
0.00
β
Beta against DOW0.00
σ
Overall volatility
0.00
Ir
Information ratio 0.00

ALCAN INC Stock Return Volatility

ALCAN INC historical daily return volatility represents how much ALCAN INC stock's price daily returns swing around its mean daily price change - it is a statistical measure of its dispersion of returns. The company has volatility of 0.0% on return distribution over 90 days investment horizon. By contrast, DOW inherits 1.2724% risk (volatility on return distribution) over the 90 days horizon.
 Performance (%) 
       Timeline  

ALCAN INC Investment Opportunity

DOW has a standard deviation of returns of 1.27 and is 9.223372036854776E16 times more volatile than ALCAN INC. of all equities and portfolios are less risky than ALCAN INC. Compared to the overall equity markets, volatility of historical daily returns of ALCAN INC is lower than 0 () of all global equities and portfolios over the last 90 days.

ALCAN INC Additional Risk Indicators

The analysis of ALCAN INC's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in ALCAN INC's investment and either accepting that risk or mitigating it. Along with some common measures of ALCAN INC stock risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Coefficient Of Variation0.0
Maximum Drawdown0.0
Potential Upside0.0
Skewness0.0
Kurtosis0.0
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stock investments, we recommend comparing similar equities with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

ALCAN INC Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against ALCAN INC as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. ALCAN INC's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, ALCAN INC's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to ALCAN INC.
Check out Trending Equities. Note that the ALCAN INC information on this page should be used as a complementary analysis to other ALCAN INC's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.

Other Tools for ALCAN Stock

When running ALCAN INC price analysis, check to measure ALCAN INC's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy ALCAN INC is operating at the current time. Most of ALCAN INC's value examination focuses on studying past and present price action to predict the probability of ALCAN INC's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move ALCAN INC's price. Additionally, you may evaluate how the addition of ALCAN INC to your portfolios can decrease your overall portfolio volatility.
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