Correlation Between Amaroq Minerals and Rockfire Resources
Can any of the company-specific risk be diversified away by investing in both Amaroq Minerals and Rockfire 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 Amaroq Minerals and Rockfire Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amaroq Minerals and Rockfire Resources plc, you can compare the effects of market volatilities on Amaroq Minerals and Rockfire 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 Amaroq Minerals with a short position of Rockfire Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amaroq Minerals and Rockfire Resources.
Diversification Opportunities for Amaroq Minerals and Rockfire Resources
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Amaroq and Rockfire is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Amaroq Minerals and Rockfire Resources plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rockfire Resources plc and Amaroq Minerals 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 Amaroq Minerals are associated (or correlated) with Rockfire Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rockfire Resources plc has no effect on the direction of Amaroq Minerals i.e., Amaroq Minerals and Rockfire Resources go up and down completely randomly.
Pair Corralation between Amaroq Minerals and Rockfire Resources
Assuming the 90 days trading horizon Amaroq Minerals is expected to generate 0.39 times more return on investment than Rockfire Resources. However, Amaroq Minerals is 2.55 times less risky than Rockfire Resources. It trades about 0.1 of its potential returns per unit of risk. Rockfire Resources plc is currently generating about 0.01 per unit of risk. If you would invest 4,120 in Amaroq Minerals on August 28, 2024 and sell it today you would earn a total of 6,095 from holding Amaroq Minerals or generate 147.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.77% |
| Values | Daily Returns |
Amaroq Minerals vs. Rockfire Resources plc
Performance |
| Timeline |
| Amaroq Minerals |
| Rockfire Resources plc |
Amaroq Minerals and Rockfire Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amaroq Minerals and Rockfire Resources
The main advantage of trading using opposite Amaroq Minerals and Rockfire Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amaroq Minerals position performs unexpectedly, Rockfire 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 Rockfire Resources will offset losses from the drop in Rockfire Resources' long position.| Amaroq Minerals vs. Givaudan SA | Amaroq Minerals vs. Antofagasta PLC | Amaroq Minerals vs. Centamin PLC | Amaroq Minerals vs. Atalaya Mining |
| Rockfire Resources vs. Ironveld Plc | Rockfire Resources vs. Foresight Environmental Infrastructure | Rockfire Resources vs. Coeur Mining | Rockfire Resources vs. Invesco Physical Silver |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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