Correlation Between Encounter Resources and Ssr Mining
Can any of the company-specific risk be diversified away by investing in both Encounter Resources and Ssr 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 Encounter Resources and Ssr Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Encounter Resources and Ssr Mining, you can compare the effects of market volatilities on Encounter Resources and Ssr 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 Encounter Resources with a short position of Ssr Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Encounter Resources and Ssr Mining.
Diversification Opportunities for Encounter Resources and Ssr Mining
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Encounter and Ssr is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Encounter Resources and Ssr Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ssr Mining and Encounter Resources 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 Encounter Resources are associated (or correlated) with Ssr Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ssr Mining has no effect on the direction of Encounter Resources i.e., Encounter Resources and Ssr Mining go up and down completely randomly.
Pair Corralation between Encounter Resources and Ssr Mining
Assuming the 90 days trading horizon Encounter Resources is expected to generate 1.71 times more return on investment than Ssr Mining. However, Encounter Resources is 1.71 times more volatile than Ssr Mining. It trades about 0.03 of its potential returns per unit of risk. Ssr Mining is currently generating about -0.03 per unit of risk. If you would invest 40.00 in Encounter Resources on September 1, 2024 and sell it today you would lose (3.00) from holding Encounter Resources or give up 7.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Encounter Resources vs. Ssr Mining
Performance |
| Timeline |
| Encounter Resources |
| Ssr Mining |
Encounter Resources and Ssr Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Encounter Resources and Ssr Mining
The main advantage of trading using opposite Encounter Resources and Ssr Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Encounter Resources position performs unexpectedly, Ssr 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 Ssr Mining will offset losses from the drop in Ssr Mining's long position.| Encounter Resources vs. Kingsrose Mining | Encounter Resources vs. Truscott Mining Corp | Encounter Resources vs. Ainsworth Game Technology | Encounter Resources vs. Talisman Mining |
| Ssr Mining vs. BKI Investment | Ssr Mining vs. Navigator Global Investments | Ssr Mining vs. Regal Investment | Ssr Mining vs. GreenX Metals |
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 Stocks Directory module to find actively traded stocks across global markets.
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