Correlation Between Eagle Mountain and Collins Foods
Can any of the company-specific risk be diversified away by investing in both Eagle Mountain and Collins Foods 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 Eagle Mountain and Collins Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Mountain Mining and Collins Foods, you can compare the effects of market volatilities on Eagle Mountain and Collins Foods 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 Eagle Mountain with a short position of Collins Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Mountain and Collins Foods.
Diversification Opportunities for Eagle Mountain and Collins Foods
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eagle and Collins is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Mountain Mining and Collins Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Collins Foods and Eagle Mountain 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 Eagle Mountain Mining are associated (or correlated) with Collins Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Collins Foods has no effect on the direction of Eagle Mountain i.e., Eagle Mountain and Collins Foods go up and down completely randomly.
Pair Corralation between Eagle Mountain and Collins Foods
Assuming the 90 days trading horizon Eagle Mountain Mining is expected to under-perform the Collins Foods. In addition to that, Eagle Mountain is 2.94 times more volatile than Collins Foods. It trades about -0.05 of its total potential returns per unit of risk. Collins Foods is currently generating about 0.03 per unit of volatility. If you would invest 696.00 in Collins Foods on August 28, 2024 and sell it today you would earn a total of 155.00 from holding Collins Foods or generate 22.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eagle Mountain Mining vs. Collins Foods
Performance |
| Timeline |
| Eagle Mountain Mining |
| Collins Foods |
Eagle Mountain and Collins Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eagle Mountain and Collins Foods
The main advantage of trading using opposite Eagle Mountain and Collins Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Mountain position performs unexpectedly, Collins Foods 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 Collins Foods will offset losses from the drop in Collins Foods' long position.| Eagle Mountain vs. Northern Star Resources | Eagle Mountain vs. Evolution Mining | Eagle Mountain vs. Bluescope Steel | Eagle Mountain vs. Sandfire Resources NL |
| Collins Foods vs. Summit Resources Limited | Collins Foods vs. Ecofibre | Collins Foods vs. iShares Global Healthcare | Collins Foods vs. Adriatic Metals Plc |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |