Correlation Between AKITA Drilling and Mako Mining
Can any of the company-specific risk be diversified away by investing in both AKITA Drilling and Mako 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 AKITA Drilling and Mako Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AKITA Drilling and Mako Mining Corp, you can compare the effects of market volatilities on AKITA Drilling and Mako 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 AKITA Drilling with a short position of Mako Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of AKITA Drilling and Mako Mining.
Diversification Opportunities for AKITA Drilling and Mako Mining
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AKITA and Mako is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding AKITA Drilling and Mako Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mako Mining Corp and AKITA Drilling 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 AKITA Drilling are associated (or correlated) with Mako Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mako Mining Corp has no effect on the direction of AKITA Drilling i.e., AKITA Drilling and Mako Mining go up and down completely randomly.
Pair Corralation between AKITA Drilling and Mako Mining
Assuming the 90 days trading horizon AKITA Drilling is expected to generate 0.69 times more return on investment than Mako Mining. However, AKITA Drilling is 1.45 times less risky than Mako Mining. It trades about 0.01 of its potential returns per unit of risk. Mako Mining Corp is currently generating about -0.07 per unit of risk. If you would invest 160.00 in AKITA Drilling on August 30, 2024 and sell it today you would earn a total of 0.00 from holding AKITA Drilling or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AKITA Drilling vs. Mako Mining Corp
Performance |
| Timeline |
| AKITA Drilling |
| Mako Mining Corp |
AKITA Drilling and Mako Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AKITA Drilling and Mako Mining
The main advantage of trading using opposite AKITA Drilling and Mako Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AKITA Drilling position performs unexpectedly, Mako 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 Mako Mining will offset losses from the drop in Mako Mining's long position.| AKITA Drilling vs. Ensign Energy Services | AKITA Drilling vs. Total Energy Services | AKITA Drilling vs. PHX Energy Services | AKITA Drilling vs. Western Energy Services |
| Mako Mining vs. Thor Explorations | Mako Mining vs. K2 Gold | Mako Mining vs. Loncor Resources | Mako Mining vs. Sarama Resource |
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 Stocks Directory module to find actively traded stocks across global markets.
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