Correlation Between CVS HEALTH and Monument Mining
Can any of the company-specific risk be diversified away by investing in both CVS HEALTH and Monument Mining 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 CVS HEALTH and Monument Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVS HEALTH CDR and Monument Mining Limited, you can compare the effects of market volatilities on CVS HEALTH and Monument Mining 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 CVS HEALTH with a short position of Monument Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVS HEALTH and Monument Mining.
Diversification Opportunities for CVS HEALTH and Monument Mining
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CVS and Monument is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding CVS HEALTH CDR and Monument Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Monument Mining and CVS HEALTH 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 CVS HEALTH CDR are associated (or correlated) with Monument Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Monument Mining has no effect on the direction of CVS HEALTH i.e., CVS HEALTH and Monument Mining go up and down completely randomly.
Pair Corralation between CVS HEALTH and Monument Mining
Assuming the 90 days trading horizon CVS HEALTH CDR is expected to under-perform the Monument Mining. But the stock apears to be less risky and, when comparing its historical volatility, CVS HEALTH CDR is 2.16 times less risky than Monument Mining. The stock trades about -0.01 of its potential returns per unit of risk. The Monument Mining Limited is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 10.00 in Monument Mining Limited on November 27, 2024 and sell it today you would earn a total of 27.00 from holding Monument Mining Limited or generate 270.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CVS HEALTH CDR vs. Monument Mining Limited
Performance |
| Timeline |
| CVS HEALTH CDR |
| Monument Mining |
CVS HEALTH and Monument Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVS HEALTH and Monument Mining
The main advantage of trading using opposite CVS HEALTH and Monument Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVS HEALTH position performs unexpectedly, Monument Mining 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 Monument Mining will offset losses from the drop in Monument Mining's long position.| CVS HEALTH vs. Champion Gaming Group | CVS HEALTH vs. Computer Modelling Group | CVS HEALTH vs. Homerun Resources | CVS HEALTH vs. Gfl Environmental Holdings |
| Monument Mining vs. Majestic Gold Corp | Monument Mining vs. Gunpoint Exploration | Monument Mining vs. Q Gold Resources | Monument Mining vs. Mundoro Capital |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |