Correlation Between Dolly Varden and Thor Mining
Can any of the company-specific risk be diversified away by investing in both Dolly Varden and Thor 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 Dolly Varden and Thor Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dolly Varden Silver and Thor Mining PLC, you can compare the effects of market volatilities on Dolly Varden and Thor 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 Dolly Varden with a short position of Thor Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dolly Varden and Thor Mining.
Diversification Opportunities for Dolly Varden and Thor Mining
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dolly and Thor is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Dolly Varden Silver and Thor Mining PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thor Mining PLC and Dolly Varden 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 Dolly Varden Silver are associated (or correlated) with Thor Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thor Mining PLC has no effect on the direction of Dolly Varden i.e., Dolly Varden and Thor Mining go up and down completely randomly.
Pair Corralation between Dolly Varden and Thor Mining
Assuming the 90 days trading horizon Dolly Varden Silver is expected to under-perform the Thor Mining. In addition to that, Dolly Varden is 1.21 times more volatile than Thor Mining PLC. It trades about -0.25 of its total potential returns per unit of risk. Thor Mining PLC is currently generating about -0.17 per unit of volatility. If you would invest 85.00 in Thor Mining PLC on September 1, 2024 and sell it today you would lose (12.00) from holding Thor Mining PLC or give up 14.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 54.55% |
| Values | Daily Returns |
Dolly Varden Silver vs. Thor Mining PLC
Performance |
| Timeline |
| Dolly Varden Silver |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
| Thor Mining PLC |
Dolly Varden and Thor Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dolly Varden and Thor Mining
The main advantage of trading using opposite Dolly Varden and Thor Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dolly Varden position performs unexpectedly, Thor 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 Thor Mining will offset losses from the drop in Thor Mining's long position.| Dolly Varden vs. PPHE Hotel Group | Dolly Varden vs. Infrastrutture Wireless Italiane | Dolly Varden vs. Trainline Plc | Dolly Varden vs. Gear4music Plc |
| Thor Mining vs. Givaudan SA | Thor Mining vs. Antofagasta PLC | Thor Mining vs. Centamin PLC | Thor Mining vs. Atalaya Mining |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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