Correlation Between Evolution Mining and Duketon Mining
Can any of the company-specific risk be diversified away by investing in both Evolution Mining and Duketon 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 Evolution Mining and Duketon Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evolution Mining and Duketon Mining, you can compare the effects of market volatilities on Evolution Mining and Duketon 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 Evolution Mining with a short position of Duketon Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolution Mining and Duketon Mining.
Diversification Opportunities for Evolution Mining and Duketon Mining
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Evolution and Duketon is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Evolution Mining and Duketon Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duketon Mining and Evolution 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 Evolution Mining are associated (or correlated) with Duketon Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duketon Mining has no effect on the direction of Evolution Mining i.e., Evolution Mining and Duketon Mining go up and down completely randomly.
Pair Corralation between Evolution Mining and Duketon Mining
Assuming the 90 days trading horizon Evolution Mining is expected to generate 0.47 times more return on investment than Duketon Mining. However, Evolution Mining is 2.11 times less risky than Duketon Mining. It trades about 0.14 of its potential returns per unit of risk. Duketon Mining is currently generating about 0.01 per unit of risk. If you would invest 338.00 in Evolution Mining on September 29, 2024 and sell it today you would earn a total of 149.00 from holding Evolution Mining or generate 44.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evolution Mining vs. Duketon Mining
Performance |
| Timeline |
| Evolution Mining |
| Duketon Mining |
Evolution Mining and Duketon Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolution Mining and Duketon Mining
The main advantage of trading using opposite Evolution Mining and Duketon Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolution Mining position performs unexpectedly, Duketon 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 Duketon Mining will offset losses from the drop in Duketon Mining's long position.| Evolution Mining vs. Global Health | Evolution Mining vs. Regal Funds Management | Evolution Mining vs. MotorCycle Holdings | Evolution Mining vs. EVE Health Group |
| Duketon Mining vs. Northern Star Resources | Duketon Mining vs. Evolution Mining | Duketon Mining vs. Bluescope Steel | Duketon Mining vs. Aneka Tambang Tbk |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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