Correlation Between Abacus Mining and Happy Creek
Can any of the company-specific risk be diversified away by investing in both Abacus Mining and Happy Creek 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 Abacus Mining and Happy Creek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Abacus Mining and and Happy Creek Minerals, you can compare the effects of market volatilities on Abacus Mining and Happy Creek 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 Abacus Mining with a short position of Happy Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abacus Mining and Happy Creek.
Diversification Opportunities for Abacus Mining and Happy Creek
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Abacus and Happy is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Abacus Mining and and Happy Creek Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Happy Creek Minerals and Abacus Mining 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 Abacus Mining and are associated (or correlated) with Happy Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Happy Creek Minerals has no effect on the direction of Abacus Mining i.e., Abacus Mining and Happy Creek go up and down completely randomly.
Pair Corralation between Abacus Mining and Happy Creek
Assuming the 90 days horizon Abacus Mining and is expected to generate 2.42 times more return on investment than Happy Creek. However, Abacus Mining is 2.42 times more volatile than Happy Creek Minerals. It trades about 0.09 of its potential returns per unit of risk. Happy Creek Minerals is currently generating about -0.06 per unit of risk. If you would invest 2.00 in Abacus Mining and on October 20, 2024 and sell it today you would earn a total of 0.00 from holding Abacus Mining and or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Abacus Mining and vs. Happy Creek Minerals
Performance |
| Timeline |
| Abacus Mining |
| Happy Creek Minerals |
Abacus Mining and Happy Creek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Abacus Mining and Happy Creek
The main advantage of trading using opposite Abacus Mining and Happy Creek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abacus Mining position performs unexpectedly, Happy Creek 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 Happy Creek will offset losses from the drop in Happy Creek's long position.| Abacus Mining vs. Happy Creek Minerals | Abacus Mining vs. Galore Resources | Abacus Mining vs. Bold Ventures |
| Happy Creek vs. Titanium Transportation Group | Happy Creek vs. Western Investment | Happy Creek vs. Maple Leaf Foods | Happy Creek vs. Economic Investment Trust |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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