Correlation Between Artemis Resources and Macmahon Holdings
Can any of the company-specific risk be diversified away by investing in both Artemis Resources and Macmahon Holdings 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 Artemis Resources and Macmahon Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Artemis Resources and Macmahon Holdings Limited, you can compare the effects of market volatilities on Artemis Resources and Macmahon Holdings 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 Artemis Resources with a short position of Macmahon Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artemis Resources and Macmahon Holdings.
Diversification Opportunities for Artemis Resources and Macmahon Holdings
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Artemis and Macmahon is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Artemis Resources and Macmahon Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macmahon Holdings and Artemis Resources 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 Artemis Resources are associated (or correlated) with Macmahon Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macmahon Holdings has no effect on the direction of Artemis Resources i.e., Artemis Resources and Macmahon Holdings go up and down completely randomly.
Pair Corralation between Artemis Resources and Macmahon Holdings
Assuming the 90 days horizon Artemis Resources is expected to generate 7.84 times more return on investment than Macmahon Holdings. However, Artemis Resources is 7.84 times more volatile than Macmahon Holdings Limited. It trades about 0.1 of its potential returns per unit of risk. Macmahon Holdings Limited is currently generating about 0.12 per unit of risk. If you would invest 2.60 in Artemis Resources on August 30, 2024 and sell it today you would lose (2.10) from holding Artemis Resources or give up 80.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 65.06% |
| Values | Daily Returns |
Artemis Resources vs. Macmahon Holdings Limited
Performance |
| Timeline |
| Artemis Resources |
| Macmahon Holdings |
Artemis Resources and Macmahon Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artemis Resources and Macmahon Holdings
The main advantage of trading using opposite Artemis Resources and Macmahon Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artemis Resources position performs unexpectedly, Macmahon Holdings 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 Macmahon Holdings will offset losses from the drop in Macmahon Holdings' long position.| Artemis Resources vs. Edison Cobalt Corp | Artemis Resources vs. Champion Bear Resources | Artemis Resources vs. Avarone Metals | Artemis Resources vs. Adriatic Metals PLC |
| Macmahon Holdings vs. Esperion Therapeutics | Macmahon Holdings vs. Fevertree Drinks Plc | Macmahon Holdings vs. Compania Cervecerias Unidas | Macmahon Holdings vs. The Joint Corp |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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