Correlation Between ExGen Resources and Themac Resources
Can any of the company-specific risk be diversified away by investing in both ExGen Resources and Themac Resources 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 ExGen Resources and Themac Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ExGen Resources and Themac Resources Group, you can compare the effects of market volatilities on ExGen Resources and Themac Resources 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 ExGen Resources with a short position of Themac Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of ExGen Resources and Themac Resources.
Diversification Opportunities for ExGen Resources and Themac Resources
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ExGen and Themac is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding ExGen Resources and Themac Resources Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Themac Resources and ExGen 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 ExGen Resources are associated (or correlated) with Themac Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Themac Resources has no effect on the direction of ExGen Resources i.e., ExGen Resources and Themac Resources go up and down completely randomly.
Pair Corralation between ExGen Resources and Themac Resources
Assuming the 90 days horizon ExGen Resources is expected to generate 0.29 times more return on investment than Themac Resources. However, ExGen Resources is 3.47 times less risky than Themac Resources. It trades about 0.22 of its potential returns per unit of risk. Themac Resources Group is currently generating about -0.09 per unit of risk. If you would invest 8.00 in ExGen Resources on September 3, 2024 and sell it today you would earn a total of 1.00 from holding ExGen Resources or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ExGen Resources vs. Themac Resources Group
Performance |
| Timeline |
| ExGen Resources |
| Themac Resources |
ExGen Resources and Themac Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ExGen Resources and Themac Resources
The main advantage of trading using opposite ExGen Resources and Themac Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ExGen Resources position performs unexpectedly, Themac Resources 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 Themac Resources will offset losses from the drop in Themac Resources' long position.| ExGen Resources vs. Hemisphere Energy | ExGen Resources vs. Westshore Terminals Investment | ExGen Resources vs. Data Communications Management | ExGen Resources vs. Andlauer Healthcare Gr |
| Themac Resources vs. Data Communications Management | Themac Resources vs. CVW CleanTech | Themac Resources vs. East Side Games | Themac Resources vs. Cogeco Communications |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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