Correlation Between Eskay Mining and Stelmine Canada
Can any of the company-specific risk be diversified away by investing in both Eskay Mining and Stelmine Canada 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 Eskay Mining and Stelmine Canada into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eskay Mining Corp and Stelmine Canada, you can compare the effects of market volatilities on Eskay Mining and Stelmine Canada 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 Eskay Mining with a short position of Stelmine Canada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eskay Mining and Stelmine Canada.
Diversification Opportunities for Eskay Mining and Stelmine Canada
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eskay and Stelmine is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Eskay Mining Corp and Stelmine Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stelmine Canada and Eskay Mining 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 Eskay Mining Corp are associated (or correlated) with Stelmine Canada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stelmine Canada has no effect on the direction of Eskay Mining i.e., Eskay Mining and Stelmine Canada go up and down completely randomly.
Pair Corralation between Eskay Mining and Stelmine Canada
Assuming the 90 days horizon Eskay Mining Corp is expected to generate 0.52 times more return on investment than Stelmine Canada. However, Eskay Mining Corp is 1.94 times less risky than Stelmine Canada. It trades about 0.09 of its potential returns per unit of risk. Stelmine Canada is currently generating about -0.1 per unit of risk. If you would invest 13.00 in Eskay Mining Corp on November 27, 2024 and sell it today you would earn a total of 1.00 from holding Eskay Mining Corp or generate 7.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eskay Mining Corp vs. Stelmine Canada
Performance |
| Timeline |
| Eskay Mining Corp |
| Stelmine Canada |
Eskay Mining and Stelmine Canada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eskay Mining and Stelmine Canada
The main advantage of trading using opposite Eskay Mining and Stelmine Canada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eskay Mining position performs unexpectedly, Stelmine Canada 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 Stelmine Canada will offset losses from the drop in Stelmine Canada's long position.| Eskay Mining vs. Aftermath Silver | Eskay Mining vs. Group Ten Metals | Eskay Mining vs. Prime Mining Corp | Eskay Mining vs. Juggernaut Exploration |
| Stelmine Canada vs. Fury Gold Mines | Stelmine Canada vs. Ivanhoe Mines | Stelmine Canada vs. Americas Silver Corp | Stelmine Canada vs. StrikePoint Gold |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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