Correlation Between Capstone Mining and Northview Residential
Can any of the company-specific risk be diversified away by investing in both Capstone Mining and Northview Residential 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 Capstone Mining and Northview Residential into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capstone Mining Corp and Northview Residential REIT, you can compare the effects of market volatilities on Capstone Mining and Northview Residential 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 Capstone Mining with a short position of Northview Residential. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capstone Mining and Northview Residential.
Diversification Opportunities for Capstone Mining and Northview Residential
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Capstone and Northview is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Capstone Mining Corp and Northview Residential REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northview Residential and Capstone Mining 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 Capstone Mining Corp are associated (or correlated) with Northview Residential. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northview Residential has no effect on the direction of Capstone Mining i.e., Capstone Mining and Northview Residential go up and down completely randomly.
Pair Corralation between Capstone Mining and Northview Residential
Assuming the 90 days horizon Capstone Mining Corp is expected to generate 1.57 times more return on investment than Northview Residential. However, Capstone Mining is 1.57 times more volatile than Northview Residential REIT. It trades about -0.01 of its potential returns per unit of risk. Northview Residential REIT is currently generating about -0.23 per unit of risk. If you would invest 973.00 in Capstone Mining Corp on August 29, 2024 and sell it today you would lose (11.00) from holding Capstone Mining Corp or give up 1.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capstone Mining Corp vs. Northview Residential REIT
Performance |
| Timeline |
| Capstone Mining Corp |
| Northview Residential |
Capstone Mining and Northview Residential Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capstone Mining and Northview Residential
The main advantage of trading using opposite Capstone Mining and Northview Residential positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capstone Mining position performs unexpectedly, Northview Residential 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 Northview Residential will offset losses from the drop in Northview Residential's long position.| Capstone Mining vs. Definity Financial Corp | Capstone Mining vs. Intact Financial Corp | Capstone Mining vs. VIP Entertainment Technologies | Capstone Mining vs. InPlay Oil Corp |
| Northview Residential vs. Canaf Investments | Northview Residential vs. Upstart Investments | Northview Residential vs. NorthWest Healthcare Properties | Northview Residential vs. Andlauer Healthcare Gr |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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