Correlation Between Check Point and Thor Mining
Can any of the company-specific risk be diversified away by investing in both Check Point 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 Check Point and Thor Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Check Point Software and Thor Mining PLC, you can compare the effects of market volatilities on Check Point 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 Check Point with a short position of Thor Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Check Point and Thor Mining.
Diversification Opportunities for Check Point and Thor Mining
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Check and Thor is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software 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 Check Point 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 Check Point Software 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 Check Point i.e., Check Point and Thor Mining go up and down completely randomly.
Pair Corralation between Check Point and Thor Mining
Assuming the 90 days trading horizon Check Point Software is expected to under-perform the Thor Mining. But the stock apears to be less risky and, when comparing its historical volatility, Check Point Software is 2.35 times less risky than Thor Mining. The stock trades about -0.16 of its potential returns per unit of risk. The Thor Mining PLC is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 73.00 in Thor Mining PLC on October 13, 2024 and sell it today you would lose (3.00) from holding Thor Mining PLC or give up 4.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Check Point Software vs. Thor Mining PLC
Performance |
| Timeline |
| Check Point Software |
| Thor Mining PLC |
Check Point and Thor Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Check Point and Thor Mining
The main advantage of trading using opposite Check Point and Thor Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Check Point 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.| Check Point vs. First Class Metals | Check Point vs. PPHE Hotel Group | Check Point vs. Coeur Mining | Check Point vs. European Metals Holdings |
| Thor Mining vs. GreenX Metals | Thor Mining vs. Europa Metals | Thor Mining vs. Wheaton Precious Metals | Thor Mining vs. Fulcrum Metals 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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