Correlation Between Jacquet Metal and Caledonia Mining
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and Caledonia Mining at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Jacquet Metal and Caledonia Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacquet Metal Service and Caledonia Mining, you can compare the effects of market volatilities on Jacquet Metal and Caledonia Mining and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Jacquet Metal with a short position of Caledonia Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and Caledonia Mining.
Diversification Opportunities for Jacquet Metal and Caledonia Mining
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jacquet and Caledonia is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and Caledonia Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caledonia Mining and Jacquet Metal is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Jacquet Metal Service are associated (or correlated) with Caledonia Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caledonia Mining has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and Caledonia Mining go up and down completely randomly.
Pair Corralation between Jacquet Metal and Caledonia Mining
Assuming the 90 days trading horizon Jacquet Metal Service is expected to generate 0.91 times more return on investment than Caledonia Mining. However, Jacquet Metal Service is 1.1 times less risky than Caledonia Mining. It trades about 0.17 of its potential returns per unit of risk. Caledonia Mining is currently generating about -0.27 per unit of risk. If you would invest 1,568 in Jacquet Metal Service on September 22, 2024 and sell it today you would earn a total of 112.00 from holding Jacquet Metal Service or generate 7.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Jacquet Metal Service vs. Caledonia Mining
Performance |
| Timeline |
| Jacquet Metal Service |
| Caledonia Mining |
Jacquet Metal and Caledonia Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacquet Metal and Caledonia Mining
The main advantage of trading using opposite Jacquet Metal and Caledonia Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, Caledonia Mining can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Caledonia Mining will offset losses from the drop in Caledonia Mining's long position.| Jacquet Metal vs. Molson Coors Beverage | Jacquet Metal vs. International Consolidated Airlines | Jacquet Metal vs. LPKF Laser Electronics | Jacquet Metal vs. Alliance Data Systems |
| Caledonia Mining vs. Check Point Software | Caledonia Mining vs. Zinc Media Group | Caledonia Mining vs. Alfa Financial Software | Caledonia Mining vs. LBG Media PLC |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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