Correlation Between CANEX Metals and Plato Gold
Can any of the company-specific risk be diversified away by investing in both CANEX Metals and Plato Gold 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 CANEX Metals and Plato Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CANEX Metals and Plato Gold Corp, you can compare the effects of market volatilities on CANEX Metals and Plato Gold 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 CANEX Metals with a short position of Plato Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of CANEX Metals and Plato Gold.
Diversification Opportunities for CANEX Metals and Plato Gold
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CANEX and Plato is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding CANEX Metals and Plato Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plato Gold Corp and CANEX Metals 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 CANEX Metals are associated (or correlated) with Plato Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plato Gold Corp has no effect on the direction of CANEX Metals i.e., CANEX Metals and Plato Gold go up and down completely randomly.
Pair Corralation between CANEX Metals and Plato Gold
Assuming the 90 days trading horizon CANEX Metals is expected to generate 2.41 times less return on investment than Plato Gold. But when comparing it to its historical volatility, CANEX Metals is 1.29 times less risky than Plato Gold. It trades about 0.03 of its potential returns per unit of risk. Plato Gold Corp is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2.00 in Plato Gold Corp on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Plato Gold Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CANEX Metals vs. Plato Gold Corp
Performance |
| Timeline |
| CANEX Metals |
| Plato Gold Corp |
CANEX Metals and Plato Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CANEX Metals and Plato Gold
The main advantage of trading using opposite CANEX Metals and Plato Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CANEX Metals position performs unexpectedly, Plato Gold 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 Plato Gold will offset losses from the drop in Plato Gold's long position.| CANEX Metals vs. Algoma Steel Group | CANEX Metals vs. Champion Iron | CANEX Metals vs. International Zeolite Corp | CANEX Metals vs. European Residential Real |
| Plato Gold vs. Q Gold Resources | Plato Gold vs. MAS Gold Corp | Plato Gold vs. ExGen Resources | Plato Gold vs. Carlin Gold |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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