Correlation Between Diamond Fields and Manhattan
Can any of the company-specific risk be diversified away by investing in both Diamond Fields and Manhattan 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 Diamond Fields and Manhattan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Diamond Fields Resources and Manhattan Limited, you can compare the effects of market volatilities on Diamond Fields and Manhattan 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 Diamond Fields with a short position of Manhattan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Diamond Fields and Manhattan.
Diversification Opportunities for Diamond Fields and Manhattan
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Diamond and Manhattan is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Diamond Fields Resources and Manhattan Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manhattan Limited and Diamond Fields 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 Diamond Fields Resources are associated (or correlated) with Manhattan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manhattan Limited has no effect on the direction of Diamond Fields i.e., Diamond Fields and Manhattan go up and down completely randomly.
Pair Corralation between Diamond Fields and Manhattan
If you would invest 0.77 in Manhattan Limited on October 20, 2024 and sell it today you would earn a total of 0.00 from holding Manhattan Limited or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
Diamond Fields Resources vs. Manhattan Limited
Performance |
| Timeline |
| Diamond Fields Resources |
| Manhattan Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Diamond Fields and Manhattan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Diamond Fields and Manhattan
The main advantage of trading using opposite Diamond Fields and Manhattan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Diamond Fields position performs unexpectedly, Manhattan 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 Manhattan will offset losses from the drop in Manhattan's long position.| Diamond Fields vs. Gemfields Group Limited | Diamond Fields vs. Star Royalties | Diamond Fields vs. Defiance Silver Corp | Diamond Fields vs. GoGold Resources |
| Manhattan vs. EnviroGold Global Limited | Manhattan vs. Gemfields Group Limited | Manhattan vs. Pacific Ridge Exploration | Manhattan vs. Star Royalties |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |