Correlation Between Focus Graphite and Jubilee Metals
Can any of the company-specific risk be diversified away by investing in both Focus Graphite and Jubilee Metals 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 Jubilee Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Focus Graphite and Jubilee Metals Group, you can compare the effects of market volatilities on Focus Graphite and Jubilee Metals 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 Jubilee Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Focus Graphite and Jubilee Metals.
Diversification Opportunities for Focus Graphite and Jubilee Metals
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Focus and Jubilee is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Focus Graphite and Jubilee Metals Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jubilee Metals Group 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 Jubilee Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jubilee Metals Group has no effect on the direction of Focus Graphite i.e., Focus Graphite and Jubilee Metals go up and down completely randomly.
Pair Corralation between Focus Graphite and Jubilee Metals
Assuming the 90 days horizon Focus Graphite is expected to generate 1.45 times more return on investment than Jubilee Metals. However, Focus Graphite is 1.45 times more volatile than Jubilee Metals Group. It trades about 0.02 of its potential returns per unit of risk. Jubilee Metals Group is currently generating about -0.05 per unit of risk. If you would invest 8.00 in Focus Graphite on September 12, 2024 and sell it today you would lose (1.00) from holding Focus Graphite or give up 12.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Focus Graphite vs. Jubilee Metals Group
Performance |
| Timeline |
| Focus Graphite |
| Jubilee Metals Group |
Focus Graphite and Jubilee Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Focus Graphite and Jubilee Metals
The main advantage of trading using opposite Focus Graphite and Jubilee Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Focus Graphite position performs unexpectedly, Jubilee Metals 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 Jubilee Metals will offset losses from the drop in Jubilee Metals' long position.| Focus Graphite vs. Northern Graphite | Focus Graphite vs. Syrah Resources Limited | Focus Graphite vs. Altura Mining Limited | Focus Graphite vs. Vulcan Minerals |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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