Correlation Between CLST Holdings and Denison Mines
Can any of the company-specific risk be diversified away by investing in both CLST Holdings and Denison Mines 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 CLST Holdings and Denison Mines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CLST Holdings and Denison Mines Corp, you can compare the effects of market volatilities on CLST Holdings and Denison Mines 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 CLST Holdings with a short position of Denison Mines. Check out your portfolio center. Please also check ongoing floating volatility patterns of CLST Holdings and Denison Mines.
Diversification Opportunities for CLST Holdings and Denison Mines
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between CLST and Denison is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding CLST Holdings and Denison Mines Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Denison Mines Corp and CLST Holdings 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 CLST Holdings are associated (or correlated) with Denison Mines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Denison Mines Corp has no effect on the direction of CLST Holdings i.e., CLST Holdings and Denison Mines go up and down completely randomly.
Pair Corralation between CLST Holdings and Denison Mines
Given the investment horizon of 90 days CLST Holdings is expected to generate 14.08 times more return on investment than Denison Mines. However, CLST Holdings is 14.08 times more volatile than Denison Mines Corp. It trades about 0.13 of its potential returns per unit of risk. Denison Mines Corp is currently generating about 0.04 per unit of risk. If you would invest 1.70 in CLST Holdings on November 2, 2024 and sell it today you would earn a total of 7.30 from holding CLST Holdings or generate 429.41% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 81.17% |
Values | Daily Returns |
CLST Holdings vs. Denison Mines Corp
Performance |
Timeline |
CLST Holdings |
Denison Mines Corp |
CLST Holdings and Denison Mines Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CLST Holdings and Denison Mines
The main advantage of trading using opposite CLST Holdings and Denison Mines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CLST Holdings position performs unexpectedly, Denison Mines 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 Denison Mines will offset losses from the drop in Denison Mines' long position.CLST Holdings vs. Skechers USA | CLST Holdings vs. Estee Lauder Companies | CLST Holdings vs. World Houseware Limited | CLST Holdings vs. Corporacion America Airports |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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