Correlation Between Cantex Mine and Fortune Bay
Can any of the company-specific risk be diversified away by investing in both Cantex Mine and Fortune Bay 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 Cantex Mine and Fortune Bay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cantex Mine Development and Fortune Bay Corp, you can compare the effects of market volatilities on Cantex Mine and Fortune Bay 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 Cantex Mine with a short position of Fortune Bay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cantex Mine and Fortune Bay.
Diversification Opportunities for Cantex Mine and Fortune Bay
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cantex and Fortune is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Cantex Mine Development and Fortune Bay Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortune Bay Corp and Cantex Mine 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 Cantex Mine Development are associated (or correlated) with Fortune Bay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortune Bay Corp has no effect on the direction of Cantex Mine i.e., Cantex Mine and Fortune Bay go up and down completely randomly.
Pair Corralation between Cantex Mine and Fortune Bay
Assuming the 90 days horizon Cantex Mine Development is expected to generate 1.35 times more return on investment than Fortune Bay. However, Cantex Mine is 1.35 times more volatile than Fortune Bay Corp. It trades about 0.04 of its potential returns per unit of risk. Fortune Bay Corp is currently generating about -0.04 per unit of risk. If you would invest 7.27 in Cantex Mine Development on August 30, 2024 and sell it today you would lose (0.01) from holding Cantex Mine Development or give up 0.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cantex Mine Development vs. Fortune Bay Corp
Performance |
| Timeline |
| Cantex Mine Development |
| Fortune Bay Corp |
Cantex Mine and Fortune Bay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cantex Mine and Fortune Bay
The main advantage of trading using opposite Cantex Mine and Fortune Bay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cantex Mine position performs unexpectedly, Fortune Bay 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 Fortune Bay will offset losses from the drop in Fortune Bay's long position.| Cantex Mine vs. Champion Bear Resources | Cantex Mine vs. Aurelia Metals Limited | Cantex Mine vs. Baroyeca Gold Silver | Cantex Mine vs. Centaurus Metals Limited |
| Fortune Bay vs. Lundin Gold | Fortune Bay vs. Lumina Gold Corp | Fortune Bay vs. Liberty Gold Corp | Fortune Bay vs. Dynacor Gold Mines |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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