Correlation Between Aspen Group and Perseus Mining
Can any of the company-specific risk be diversified away by investing in both Aspen Group and Perseus 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 Aspen Group and Perseus Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aspen Group Unit and Perseus Mining, you can compare the effects of market volatilities on Aspen Group and Perseus 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 Aspen Group with a short position of Perseus Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspen Group and Perseus Mining.
Diversification Opportunities for Aspen Group and Perseus Mining
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aspen and Perseus is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Aspen Group Unit and Perseus Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perseus Mining and Aspen Group 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 Aspen Group Unit are associated (or correlated) with Perseus Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perseus Mining has no effect on the direction of Aspen Group i.e., Aspen Group and Perseus Mining go up and down completely randomly.
Pair Corralation between Aspen Group and Perseus Mining
Assuming the 90 days trading horizon Aspen Group is expected to generate 1.3 times less return on investment than Perseus Mining. But when comparing it to its historical volatility, Aspen Group Unit is 1.34 times less risky than Perseus Mining. It trades about 0.07 of its potential returns per unit of risk. Perseus Mining is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 174.00 in Perseus Mining on September 12, 2024 and sell it today you would earn a total of 103.00 from holding Perseus Mining or generate 59.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aspen Group Unit vs. Perseus Mining
Performance |
| Timeline |
| Aspen Group Unit |
| Perseus Mining |
Aspen Group and Perseus Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aspen Group and Perseus Mining
The main advantage of trading using opposite Aspen Group and Perseus Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aspen Group position performs unexpectedly, Perseus 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 Perseus Mining will offset losses from the drop in Perseus Mining's long position.| Aspen Group vs. Seven West Media | Aspen Group vs. Centuria Industrial Reit | Aspen Group vs. AiMedia Technologies | Aspen Group vs. Bailador Technology Invest |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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