Correlation Between Electra Battery and Maple Peak
Can any of the company-specific risk be diversified away by investing in both Electra Battery and Maple Peak 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 Electra Battery and Maple Peak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electra Battery Materials and Maple Peak Investments, you can compare the effects of market volatilities on Electra Battery and Maple Peak 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 Electra Battery with a short position of Maple Peak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electra Battery and Maple Peak.
Diversification Opportunities for Electra Battery and Maple Peak
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Electra and Maple is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Electra Battery Materials and Maple Peak Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maple Peak Investments and Electra Battery 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 Electra Battery Materials are associated (or correlated) with Maple Peak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maple Peak Investments has no effect on the direction of Electra Battery i.e., Electra Battery and Maple Peak go up and down completely randomly.
Pair Corralation between Electra Battery and Maple Peak
Assuming the 90 days trading horizon Electra Battery Materials is expected to under-perform the Maple Peak. But the stock apears to be less risky and, when comparing its historical volatility, Electra Battery Materials is 2.5 times less risky than Maple Peak. The stock trades about 0.0 of its potential returns per unit of risk. The Maple Peak Investments is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1.50 in Maple Peak Investments on September 12, 2024 and sell it today you would lose (0.50) from holding Maple Peak Investments or give up 33.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electra Battery Materials vs. Maple Peak Investments
Performance |
| Timeline |
| Electra Battery Materials |
| Maple Peak Investments |
Electra Battery and Maple Peak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electra Battery and Maple Peak
The main advantage of trading using opposite Electra Battery and Maple Peak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electra Battery position performs unexpectedly, Maple Peak 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 Maple Peak will offset losses from the drop in Maple Peak's long position.| Electra Battery vs. Ressources Minieres Radisson | Electra Battery vs. Galantas Gold Corp | Electra Battery vs. Red Pine Exploration | Electra Battery vs. Kore Mining |
| Maple Peak vs. Algoma Steel Group | Maple Peak vs. Tree Island Steel | Maple Peak vs. Rocky Mountain Liquor | Maple Peak vs. Rogers Communications |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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