Correlation Between Catena Media and Endeavour Mining
Can any of the company-specific risk be diversified away by investing in both Catena Media and Endeavour 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 Catena Media and Endeavour Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catena Media PLC and Endeavour Mining Corp, you can compare the effects of market volatilities on Catena Media and Endeavour 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 Catena Media with a short position of Endeavour Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catena Media and Endeavour Mining.
Diversification Opportunities for Catena Media and Endeavour Mining
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Catena and Endeavour is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Catena Media PLC and Endeavour Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Endeavour Mining Corp and Catena Media 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 Catena Media PLC are associated (or correlated) with Endeavour Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Endeavour Mining Corp has no effect on the direction of Catena Media i.e., Catena Media and Endeavour Mining go up and down completely randomly.
Pair Corralation between Catena Media and Endeavour Mining
Assuming the 90 days trading horizon Catena Media PLC is expected to under-perform the Endeavour Mining. In addition to that, Catena Media is 1.87 times more volatile than Endeavour Mining Corp. It trades about -0.06 of its total potential returns per unit of risk. Endeavour Mining Corp is currently generating about 0.01 per unit of volatility. If you would invest 165,543 in Endeavour Mining Corp on August 26, 2024 and sell it today you would lose (6,343) from holding Endeavour Mining Corp or give up 3.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Catena Media PLC vs. Endeavour Mining Corp
Performance |
| Timeline |
| Catena Media PLC |
| Endeavour Mining Corp |
Catena Media and Endeavour Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catena Media and Endeavour Mining
The main advantage of trading using opposite Catena Media and Endeavour Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catena Media position performs unexpectedly, Endeavour 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 Endeavour Mining will offset losses from the drop in Endeavour Mining's long position.| Catena Media vs. Herald Investment Trust | Catena Media vs. The Mercantile Investment | Catena Media vs. National Beverage Corp | Catena Media vs. Molson Coors Beverage |
| Endeavour Mining vs. Panther Metals PLC | Endeavour Mining vs. Neometals | Endeavour Mining vs. Metals Exploration Plc | Endeavour Mining vs. One Media iP |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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