Correlation Between Denison Mines and Mako Mining
Can any of the company-specific risk be diversified away by investing in both Denison Mines and Mako 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 Denison Mines and Mako Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Denison Mines Corp and Mako Mining Corp, you can compare the effects of market volatilities on Denison Mines and Mako 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 Denison Mines with a short position of Mako Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Denison Mines and Mako Mining.
Diversification Opportunities for Denison Mines and Mako Mining
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Denison and Mako is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Denison Mines Corp and Mako Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mako Mining Corp and Denison Mines 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 Denison Mines Corp are associated (or correlated) with Mako Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mako Mining Corp has no effect on the direction of Denison Mines i.e., Denison Mines and Mako Mining go up and down completely randomly.
Pair Corralation between Denison Mines and Mako Mining
Considering the 90-day investment horizon Denison Mines is expected to generate 10.46 times less return on investment than Mako Mining. In addition to that, Denison Mines is 1.13 times more volatile than Mako Mining Corp. It trades about 0.03 of its total potential returns per unit of risk. Mako Mining Corp is currently generating about 0.34 per unit of volatility. If you would invest 191.00 in Mako Mining Corp on October 31, 2024 and sell it today you would earn a total of 68.00 from holding Mako Mining Corp or generate 35.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Denison Mines Corp vs. Mako Mining Corp
Performance |
| Timeline |
| Denison Mines Corp |
| Mako Mining Corp |
Denison Mines and Mako Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Denison Mines and Mako Mining
The main advantage of trading using opposite Denison Mines and Mako Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Denison Mines position performs unexpectedly, Mako 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 Mako Mining will offset losses from the drop in Mako Mining's long position.| Denison Mines vs. Energy Fuels | Denison Mines vs. enCore Energy Corp | Denison Mines vs. Ur Energy | Denison Mines vs. Cameco Corp |
| Mako Mining vs. Labrador Gold Corp | Mako Mining vs. Exploits Discovery Corp | Mako Mining vs. Puma Exploration | Mako Mining vs. White Gold Corp |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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