Correlation Between CDN Maverick and Aldebaran Resources
Can any of the company-specific risk be diversified away by investing in both CDN Maverick and Aldebaran 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 CDN Maverick and Aldebaran Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CDN Maverick Capital and Aldebaran Resources, you can compare the effects of market volatilities on CDN Maverick and Aldebaran 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 CDN Maverick with a short position of Aldebaran Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of CDN Maverick and Aldebaran Resources.
Diversification Opportunities for CDN Maverick and Aldebaran Resources
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CDN and Aldebaran is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding CDN Maverick Capital and Aldebaran Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aldebaran Resources and CDN Maverick 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 CDN Maverick Capital are associated (or correlated) with Aldebaran Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aldebaran Resources has no effect on the direction of CDN Maverick i.e., CDN Maverick and Aldebaran Resources go up and down completely randomly.
Pair Corralation between CDN Maverick and Aldebaran Resources
Assuming the 90 days horizon CDN Maverick Capital is expected to under-perform the Aldebaran Resources. But the otc stock apears to be less risky and, when comparing its historical volatility, CDN Maverick Capital is 1.72 times less risky than Aldebaran Resources. The otc stock trades about -0.11 of its potential returns per unit of risk. The Aldebaran Resources is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 120.00 in Aldebaran Resources on September 1, 2024 and sell it today you would earn a total of 30.00 from holding Aldebaran Resources or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
CDN Maverick Capital vs. Aldebaran Resources
Performance |
| Timeline |
| CDN Maverick Capital |
| Aldebaran Resources |
CDN Maverick and Aldebaran Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CDN Maverick and Aldebaran Resources
The main advantage of trading using opposite CDN Maverick and Aldebaran Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CDN Maverick position performs unexpectedly, Aldebaran 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 Aldebaran Resources will offset losses from the drop in Aldebaran Resources' long position.| CDN Maverick vs. Aurelia Metals Limited | CDN Maverick vs. Artemis Resources | CDN Maverick vs. Ascendant Resources | CDN Maverick vs. Azimut Exploration |
| Aldebaran Resources vs. Huntsman Exploration | Aldebaran Resources vs. Aurelia Metals Limited | Aldebaran Resources vs. Adriatic Metals PLC | Aldebaran Resources vs. American Helium |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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