Correlation Between Cornish Metals and Ocean Harvest
Can any of the company-specific risk be diversified away by investing in both Cornish Metals and Ocean Harvest 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 Cornish Metals and Ocean Harvest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cornish Metals and Ocean Harvest Technology, you can compare the effects of market volatilities on Cornish Metals and Ocean Harvest 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 Cornish Metals with a short position of Ocean Harvest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cornish Metals and Ocean Harvest.
Diversification Opportunities for Cornish Metals and Ocean Harvest
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cornish and Ocean is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Cornish Metals and Ocean Harvest Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocean Harvest Technology and Cornish 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 Cornish Metals are associated (or correlated) with Ocean Harvest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocean Harvest Technology has no effect on the direction of Cornish Metals i.e., Cornish Metals and Ocean Harvest go up and down completely randomly.
Pair Corralation between Cornish Metals and Ocean Harvest
Assuming the 90 days trading horizon Cornish Metals is expected to generate 0.96 times more return on investment than Ocean Harvest. However, Cornish Metals is 1.04 times less risky than Ocean Harvest. It trades about -0.03 of its potential returns per unit of risk. Ocean Harvest Technology is currently generating about -0.4 per unit of risk. If you would invest 865.00 in Cornish Metals on October 28, 2024 and sell it today you would lose (15.00) from holding Cornish Metals or give up 1.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cornish Metals vs. Ocean Harvest Technology
Performance |
| Timeline |
| Cornish Metals |
| Ocean Harvest Technology |
Cornish Metals and Ocean Harvest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cornish Metals and Ocean Harvest
The main advantage of trading using opposite Cornish Metals and Ocean Harvest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cornish Metals position performs unexpectedly, Ocean Harvest 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 Ocean Harvest will offset losses from the drop in Ocean Harvest's long position.| Cornish Metals vs. Givaudan SA | Cornish Metals vs. Antofagasta PLC | Cornish Metals vs. Ferrexpo PLC | Cornish Metals vs. Atalaya Mining |
| Ocean Harvest vs. Eastinco Mining Exploration | Ocean Harvest vs. EVS Broadcast Equipment | Ocean Harvest vs. JB Hunt Transport | Ocean Harvest vs. JD Sports Fashion |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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