Correlation Between Capital Metals and Seraphim Space
Can any of the company-specific risk be diversified away by investing in both Capital Metals and Seraphim Space 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 Capital Metals and Seraphim Space into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Metals PLC and Seraphim Space Investment, you can compare the effects of market volatilities on Capital Metals and Seraphim Space 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 Capital Metals with a short position of Seraphim Space. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Metals and Seraphim Space.
Diversification Opportunities for Capital Metals and Seraphim Space
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Capital and Seraphim is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Capital Metals PLC and Seraphim Space Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seraphim Space Investment and Capital 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 Capital Metals PLC are associated (or correlated) with Seraphim Space. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seraphim Space Investment has no effect on the direction of Capital Metals i.e., Capital Metals and Seraphim Space go up and down completely randomly.
Pair Corralation between Capital Metals and Seraphim Space
Assuming the 90 days trading horizon Capital Metals PLC is expected to under-perform the Seraphim Space. In addition to that, Capital Metals is 1.02 times more volatile than Seraphim Space Investment. It trades about -0.34 of its total potential returns per unit of risk. Seraphim Space Investment is currently generating about -0.14 per unit of volatility. If you would invest 5,670 in Seraphim Space Investment on October 16, 2024 and sell it today you would lose (250.00) from holding Seraphim Space Investment or give up 4.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capital Metals PLC vs. Seraphim Space Investment
Performance |
| Timeline |
| Capital Metals PLC |
| Seraphim Space Investment |
Capital Metals and Seraphim Space Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Metals and Seraphim Space
The main advantage of trading using opposite Capital Metals and Seraphim Space positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Metals position performs unexpectedly, Seraphim Space 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 Seraphim Space will offset losses from the drop in Seraphim Space's long position.| Capital Metals vs. GreenX Metals | Capital Metals vs. First Class Metals | Capital Metals vs. Metals Exploration Plc | Capital Metals vs. Games Workshop Group |
| Seraphim Space vs. Capital Metals PLC | Seraphim Space vs. McEwen Mining | Seraphim Space vs. Westlake Chemical Corp | Seraphim Space vs. Air Products Chemicals |
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 CEOs Directory module to screen CEOs from public companies around the world.
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