Correlation Between Champion Bear and Metals X
Can any of the company-specific risk be diversified away by investing in both Champion Bear and Metals X 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 Champion Bear and Metals X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Champion Bear Resources and Metals X Limited, you can compare the effects of market volatilities on Champion Bear and Metals X 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 Champion Bear with a short position of Metals X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Champion Bear and Metals X.
Diversification Opportunities for Champion Bear and Metals X
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Champion and Metals is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Champion Bear Resources and Metals X Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metals X Limited and Champion Bear 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 Champion Bear Resources are associated (or correlated) with Metals X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metals X Limited has no effect on the direction of Champion Bear i.e., Champion Bear and Metals X go up and down completely randomly.
Pair Corralation between Champion Bear and Metals X
Assuming the 90 days horizon Champion Bear Resources is expected to generate 6.05 times more return on investment than Metals X. However, Champion Bear is 6.05 times more volatile than Metals X Limited. It trades about 0.06 of its potential returns per unit of risk. Metals X Limited is currently generating about 0.02 per unit of risk. If you would invest 6.00 in Champion Bear Resources on October 26, 2024 and sell it today you would lose (3.00) from holding Champion Bear Resources or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.33% |
| Values | Daily Returns |
Champion Bear Resources vs. Metals X Limited
Performance |
| Timeline |
| Champion Bear Resources |
| Metals X Limited |
Champion Bear and Metals X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Champion Bear and Metals X
The main advantage of trading using opposite Champion Bear and Metals X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Champion Bear position performs unexpectedly, Metals X 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 Metals X will offset losses from the drop in Metals X's long position.| Champion Bear vs. Aurelia Metals Limited | Champion Bear vs. Baroyeca Gold Silver | Champion Bear vs. Centaurus Metals Limited | Champion Bear vs. Edison Cobalt Corp |
| Metals X vs. Eramet SA ADR | Metals X vs. NGEx Minerals | Metals X vs. Forum Energy Metals | Metals X vs. Adriatic Metals Plc |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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