Correlation Between Capstone Mining and Wilmington Capital
Can any of the company-specific risk be diversified away by investing in both Capstone Mining and Wilmington Capital 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 Wilmington Capital 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 Wilmington Capital Management, you can compare the effects of market volatilities on Capstone Mining and Wilmington Capital 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 Wilmington Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capstone Mining and Wilmington Capital.
Diversification Opportunities for Capstone Mining and Wilmington Capital
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Capstone and Wilmington is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Capstone Mining Corp and Wilmington Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmington Capital 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 Wilmington Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmington Capital has no effect on the direction of Capstone Mining i.e., Capstone Mining and Wilmington Capital go up and down completely randomly.
Pair Corralation between Capstone Mining and Wilmington Capital
Assuming the 90 days horizon Capstone Mining is expected to generate 4.49 times less return on investment than Wilmington Capital. In addition to that, Capstone Mining is 1.0 times more volatile than Wilmington Capital Management. It trades about 0.05 of its total potential returns per unit of risk. Wilmington Capital Management is currently generating about 0.21 per unit of volatility. If you would invest 250.00 in Wilmington Capital Management on August 25, 2024 and sell it today you would earn a total of 31.00 from holding Wilmington Capital Management or generate 12.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Capstone Mining Corp vs. Wilmington Capital Management
Performance |
| Timeline |
| Capstone Mining Corp |
| Wilmington Capital |
Capstone Mining and Wilmington Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capstone Mining and Wilmington Capital
The main advantage of trading using opposite Capstone Mining and Wilmington Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capstone Mining position performs unexpectedly, Wilmington Capital 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 Wilmington Capital will offset losses from the drop in Wilmington Capital's long position.| Capstone Mining vs. Wilmington Capital Management | Capstone Mining vs. Metalero Mining Corp | Capstone Mining vs. High Liner Foods | Capstone Mining vs. Lion One Metals |
| Wilmington Capital vs. CNJ Capital Investments | Wilmington Capital vs. Westshore Terminals Investment | Wilmington Capital vs. Cogeco Communications | Wilmington Capital vs. Data Communications Management |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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