Correlation Between Centaurus Metals and Cantex Mine
Can any of the company-specific risk be diversified away by investing in both Centaurus Metals and Cantex Mine 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 Cantex Mine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centaurus Metals Limited and Cantex Mine Development, you can compare the effects of market volatilities on Centaurus Metals and Cantex Mine 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 Cantex Mine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centaurus Metals and Cantex Mine.
Diversification Opportunities for Centaurus Metals and Cantex Mine
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Centaurus and Cantex is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Centaurus Metals Limited and Cantex Mine Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cantex Mine Development 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 Limited are associated (or correlated) with Cantex Mine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cantex Mine Development has no effect on the direction of Centaurus Metals i.e., Centaurus Metals and Cantex Mine go up and down completely randomly.
Pair Corralation between Centaurus Metals and Cantex Mine
Assuming the 90 days horizon Centaurus Metals Limited is expected to generate 1.39 times more return on investment than Cantex Mine. However, Centaurus Metals is 1.39 times more volatile than Cantex Mine Development. It trades about 0.01 of its potential returns per unit of risk. Cantex Mine Development is currently generating about -0.06 per unit of risk. If you would invest 35.00 in Centaurus Metals Limited on August 25, 2024 and sell it today you would lose (7.00) from holding Centaurus Metals Limited or give up 20.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Centaurus Metals Limited vs. Cantex Mine Development
Performance |
| Timeline |
| Centaurus Metals |
| Cantex Mine Development |
Centaurus Metals and Cantex Mine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centaurus Metals and Cantex Mine
The main advantage of trading using opposite Centaurus Metals and Cantex Mine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centaurus Metals position performs unexpectedly, Cantex Mine 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 Cantex Mine will offset losses from the drop in Cantex Mine's long position.| Centaurus Metals vs. Norra Metals Corp | Centaurus Metals vs. ZincX Resources Corp | Centaurus Metals vs. Nuinsco Resources Limited | Centaurus Metals vs. South Star Battery |
| Cantex Mine vs. Norra Metals Corp | Cantex Mine vs. ZincX Resources Corp | Cantex Mine vs. Nuinsco Resources Limited | Cantex Mine vs. South Star Battery |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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