Correlation Between Brimstone Investment and Eastern Platinum
Can any of the company-specific risk be diversified away by investing in both Brimstone Investment and Eastern Platinum 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 Brimstone Investment and Eastern Platinum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brimstone Investment and Eastern Platinum Limited, you can compare the effects of market volatilities on Brimstone Investment and Eastern Platinum 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 Brimstone Investment with a short position of Eastern Platinum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brimstone Investment and Eastern Platinum.
Diversification Opportunities for Brimstone Investment and Eastern Platinum
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Brimstone and Eastern is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Brimstone Investment and Eastern Platinum Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern Platinum and Brimstone Investment 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 Brimstone Investment are associated (or correlated) with Eastern Platinum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern Platinum has no effect on the direction of Brimstone Investment i.e., Brimstone Investment and Eastern Platinum go up and down completely randomly.
Pair Corralation between Brimstone Investment and Eastern Platinum
Assuming the 90 days trading horizon Brimstone Investment is expected to generate 1.87 times less return on investment than Eastern Platinum. But when comparing it to its historical volatility, Brimstone Investment is 1.44 times less risky than Eastern Platinum. It trades about 0.05 of its potential returns per unit of risk. Eastern Platinum Limited is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 33,100 in Eastern Platinum Limited on August 30, 2024 and sell it today you would lose (17,100) from holding Eastern Platinum Limited or give up 51.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Brimstone Investment vs. Eastern Platinum Limited
Performance |
| Timeline |
| Brimstone Investment |
| Eastern Platinum |
Brimstone Investment and Eastern Platinum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brimstone Investment and Eastern Platinum
The main advantage of trading using opposite Brimstone Investment and Eastern Platinum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brimstone Investment position performs unexpectedly, Eastern Platinum 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 Eastern Platinum will offset losses from the drop in Eastern Platinum's long position.| Brimstone Investment vs. Advtech | Brimstone Investment vs. Hosken Consolidated Investments | Brimstone Investment vs. Deneb Investments | Brimstone Investment vs. Afine Investments |
| Eastern Platinum vs. British American Tobacco | Eastern Platinum vs. Anglo American PLC | Eastern Platinum vs. Anglo American Platinum | Eastern Platinum vs. ABSA Bank Limited |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| CEOs Directory Screen CEOs from public companies around the world |