Correlation Between AXMIN and CANASIL RESOURCES
Can any of the company-specific risk be diversified away by investing in both AXMIN and CANASIL RESOURCES 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 AXMIN and CANASIL RESOURCES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AXMIN Inc and CANASIL RESOURCES, you can compare the effects of market volatilities on AXMIN and CANASIL RESOURCES 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 AXMIN with a short position of CANASIL RESOURCES. Check out your portfolio center. Please also check ongoing floating volatility patterns of AXMIN and CANASIL RESOURCES.
Diversification Opportunities for AXMIN and CANASIL RESOURCES
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between AXMIN and CANASIL is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding AXMIN Inc and CANASIL RESOURCES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CANASIL RESOURCES and AXMIN 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 AXMIN Inc are associated (or correlated) with CANASIL RESOURCES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CANASIL RESOURCES has no effect on the direction of AXMIN i.e., AXMIN and CANASIL RESOURCES go up and down completely randomly.
Pair Corralation between AXMIN and CANASIL RESOURCES
Assuming the 90 days trading horizon AXMIN is expected to generate 20.67 times less return on investment than CANASIL RESOURCES. But when comparing it to its historical volatility, AXMIN Inc is 4.53 times less risky than CANASIL RESOURCES. It trades about 0.02 of its potential returns per unit of risk. CANASIL RESOURCES is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1.65 in CANASIL RESOURCES on August 31, 2024 and sell it today you would lose (0.40) from holding CANASIL RESOURCES or give up 24.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
AXMIN Inc vs. CANASIL RESOURCES
Performance |
| Timeline |
| AXMIN Inc |
| CANASIL RESOURCES |
AXMIN and CANASIL RESOURCES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AXMIN and CANASIL RESOURCES
The main advantage of trading using opposite AXMIN and CANASIL RESOURCES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AXMIN position performs unexpectedly, CANASIL RESOURCES 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 CANASIL RESOURCES will offset losses from the drop in CANASIL RESOURCES's long position.| AXMIN vs. Silicon Motion Technology | AXMIN vs. Soken Chemical Engineering | AXMIN vs. Sumitomo Chemical | AXMIN vs. CHEMICAL INDUSTRIES |
| CANASIL RESOURCES vs. SIVERS SEMICONDUCTORS AB | CANASIL RESOURCES vs. Darden Restaurants | CANASIL RESOURCES vs. Reliance Steel Aluminum | CANASIL RESOURCES vs. Q2M Managementberatung AG |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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