Correlation Between Focus Graphite and Stans Energy
Can any of the company-specific risk be diversified away by investing in both Focus Graphite and Stans Energy 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 Focus Graphite and Stans Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Focus Graphite and Stans Energy Corp, you can compare the effects of market volatilities on Focus Graphite and Stans Energy 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 Focus Graphite with a short position of Stans Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Focus Graphite and Stans Energy.
Diversification Opportunities for Focus Graphite and Stans Energy
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Focus and Stans is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Focus Graphite and Stans Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stans Energy Corp and Focus Graphite 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 Focus Graphite are associated (or correlated) with Stans Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stans Energy Corp has no effect on the direction of Focus Graphite i.e., Focus Graphite and Stans Energy go up and down completely randomly.
Pair Corralation between Focus Graphite and Stans Energy
Assuming the 90 days horizon Focus Graphite is expected to generate 307.81 times less return on investment than Stans Energy. But when comparing it to its historical volatility, Focus Graphite is 10.5 times less risky than Stans Energy. It trades about 0.0 of its potential returns per unit of risk. Stans Energy Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 0.01 in Stans Energy Corp on November 5, 2024 and sell it today you would earn a total of 0.00 from holding Stans Energy Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.59% |
| Values | Daily Returns |
Focus Graphite vs. Stans Energy Corp
Performance |
| Timeline |
| Focus Graphite |
| Stans Energy Corp |
Focus Graphite and Stans Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Focus Graphite and Stans Energy
The main advantage of trading using opposite Focus Graphite and Stans Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Focus Graphite position performs unexpectedly, Stans Energy 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 Stans Energy will offset losses from the drop in Stans Energy's long position.| Focus Graphite vs. Northern Graphite | Focus Graphite vs. Syrah Resources Limited | Focus Graphite vs. Altura Mining Limited | Focus Graphite vs. Vulcan Minerals |
| Stans Energy vs. Ridgestone Mining | Stans Energy vs. Lion Copper and | Stans Energy vs. FPX Nickel Corp | Stans Energy vs. Focus Graphite |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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