Correlation Between Centaurus Metals and Bendigo
Can any of the company-specific risk be diversified away by investing in both Centaurus Metals and Bendigo 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 Centaurus Metals and Bendigo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centaurus Metals and Bendigo And Adelaide, you can compare the effects of market volatilities on Centaurus Metals and Bendigo 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 Centaurus Metals with a short position of Bendigo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centaurus Metals and Bendigo.
Diversification Opportunities for Centaurus Metals and Bendigo
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Centaurus and Bendigo is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Centaurus Metals and Bendigo And Adelaide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bendigo And Adelaide and Centaurus 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 Centaurus Metals are associated (or correlated) with Bendigo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bendigo And Adelaide has no effect on the direction of Centaurus Metals i.e., Centaurus Metals and Bendigo go up and down completely randomly.
Pair Corralation between Centaurus Metals and Bendigo
Assuming the 90 days trading horizon Centaurus Metals is expected to generate 6.63 times less return on investment than Bendigo. In addition to that, Centaurus Metals is 4.44 times more volatile than Bendigo And Adelaide. It trades about 0.01 of its total potential returns per unit of risk. Bendigo And Adelaide is currently generating about 0.16 per unit of volatility. If you would invest 822.00 in Bendigo And Adelaide on September 19, 2024 and sell it today you would earn a total of 525.00 from holding Bendigo And Adelaide or generate 63.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centaurus Metals vs. Bendigo And Adelaide
Performance |
| Timeline |
| Centaurus Metals |
| Bendigo And Adelaide |
Centaurus Metals and Bendigo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centaurus Metals and Bendigo
The main advantage of trading using opposite Centaurus Metals and Bendigo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centaurus Metals position performs unexpectedly, Bendigo 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 Bendigo will offset losses from the drop in Bendigo's long position.| Centaurus Metals vs. Northern Star Resources | Centaurus Metals vs. Evolution Mining | Centaurus Metals vs. Bluescope Steel | Centaurus Metals vs. Sandfire Resources NL |
| Bendigo vs. Event Hospitality and | Bendigo vs. Sky Metals | Bendigo vs. Centaurus Metals | Bendigo vs. Black Rock Mining |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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