Correlation Between Credit Clear and Eagle Mountain
Can any of the company-specific risk be diversified away by investing in both Credit Clear and Eagle Mountain 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 Credit Clear and Eagle Mountain into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Credit Clear and Eagle Mountain Mining, you can compare the effects of market volatilities on Credit Clear and Eagle Mountain 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 Credit Clear with a short position of Eagle Mountain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Clear and Eagle Mountain.
Diversification Opportunities for Credit Clear and Eagle Mountain
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Credit and Eagle is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Credit Clear and Eagle Mountain Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Mountain Mining and Credit Clear 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 Credit Clear are associated (or correlated) with Eagle Mountain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Mountain Mining has no effect on the direction of Credit Clear i.e., Credit Clear and Eagle Mountain go up and down completely randomly.
Pair Corralation between Credit Clear and Eagle Mountain
Assuming the 90 days trading horizon Credit Clear is expected to generate 0.74 times more return on investment than Eagle Mountain. However, Credit Clear is 1.35 times less risky than Eagle Mountain. It trades about 0.1 of its potential returns per unit of risk. Eagle Mountain Mining is currently generating about -0.07 per unit of risk. If you would invest 24.00 in Credit Clear on August 24, 2024 and sell it today you would earn a total of 11.00 from holding Credit Clear or generate 45.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Credit Clear vs. Eagle Mountain Mining
Performance |
| Timeline |
| Credit Clear |
| Eagle Mountain Mining |
Credit Clear and Eagle Mountain Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Credit Clear and Eagle Mountain
The main advantage of trading using opposite Credit Clear and Eagle Mountain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credit Clear position performs unexpectedly, Eagle Mountain 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 Eagle Mountain will offset losses from the drop in Eagle Mountain's long position.| Credit Clear vs. Aneka Tambang Tbk | Credit Clear vs. Macquarie Group | Credit Clear vs. Macquarie Group Ltd | Credit Clear vs. Rio Tinto |
| Eagle Mountain vs. Evolution Mining | Eagle Mountain vs. Bluescope Steel | Eagle Mountain vs. Perseus Mining | Eagle Mountain vs. Champion Iron |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |