Correlation Between Benton Resources and Namibia Critical
Can any of the company-specific risk be diversified away by investing in both Benton Resources and Namibia Critical 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 Benton Resources and Namibia Critical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Benton Resources and Namibia Critical Metals, you can compare the effects of market volatilities on Benton Resources and Namibia Critical 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 Benton Resources with a short position of Namibia Critical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Benton Resources and Namibia Critical.
Diversification Opportunities for Benton Resources and Namibia Critical
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Benton and Namibia is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Benton Resources and Namibia Critical Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Namibia Critical Metals and Benton 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 Benton Resources are associated (or correlated) with Namibia Critical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Namibia Critical Metals has no effect on the direction of Benton Resources i.e., Benton Resources and Namibia Critical go up and down completely randomly.
Pair Corralation between Benton Resources and Namibia Critical
Assuming the 90 days horizon Benton Resources is expected to generate 1.61 times more return on investment than Namibia Critical. However, Benton Resources is 1.61 times more volatile than Namibia Critical Metals. It trades about 0.12 of its potential returns per unit of risk. Namibia Critical Metals is currently generating about 0.06 per unit of risk. If you would invest 4.83 in Benton Resources on November 3, 2024 and sell it today you would earn a total of 0.53 from holding Benton Resources or generate 10.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Benton Resources vs. Namibia Critical Metals
Performance |
| Timeline |
| Benton Resources |
| Namibia Critical Metals |
Benton Resources and Namibia Critical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Benton Resources and Namibia Critical
The main advantage of trading using opposite Benton Resources and Namibia Critical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Benton Resources position performs unexpectedly, Namibia Critical 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 Namibia Critical will offset losses from the drop in Namibia Critical's long position.| Benton Resources vs. Aurelia Metals Limited | Benton Resources vs. Artemis Resources | Benton Resources vs. Ascendant Resources | Benton Resources vs. Altiplano Metals |
| Namibia Critical vs. Benton Resources | Namibia Critical vs. Azimut Exploration | Namibia Critical vs. FPX Nickel Corp | Namibia Critical vs. VR Resources |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |