Correlation Between Euro Manganese and American CuMo
Can any of the company-specific risk be diversified away by investing in both Euro Manganese and American CuMo 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 Euro Manganese and American CuMo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Euro Manganese and American CuMo Mining, you can compare the effects of market volatilities on Euro Manganese and American CuMo 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 Euro Manganese with a short position of American CuMo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Euro Manganese and American CuMo.
Diversification Opportunities for Euro Manganese and American CuMo
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Euro and American is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Euro Manganese and American CuMo Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American CuMo Mining and Euro Manganese 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 Euro Manganese are associated (or correlated) with American CuMo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American CuMo Mining has no effect on the direction of Euro Manganese i.e., Euro Manganese and American CuMo go up and down completely randomly.
Pair Corralation between Euro Manganese and American CuMo
If you would invest 2.80 in Euro Manganese on November 9, 2024 and sell it today you would earn a total of 0.30 from holding Euro Manganese or generate 10.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Euro Manganese vs. American CuMo Mining
Performance |
| Timeline |
| Euro Manganese |
| American CuMo Mining |
Euro Manganese and American CuMo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Euro Manganese and American CuMo
The main advantage of trading using opposite Euro Manganese and American CuMo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Euro Manganese position performs unexpectedly, American CuMo 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 American CuMo will offset losses from the drop in American CuMo's long position.| Euro Manganese vs. Bravada Gold | Euro Manganese vs. Silver Spruce Resources | Euro Manganese vs. Monitor Ventures | Euro Manganese vs. Pershing Resources |
| American CuMo vs. Pasinex Resources Limited | American CuMo vs. Themac Resources Group | American CuMo vs. East Africa Metals | American CuMo vs. Forsys Metals 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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