Correlation Between Financial and Mako Mining
Can any of the company-specific risk be diversified away by investing in both Financial and Mako 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 Financial and Mako Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Financial 15 Split and Mako Mining Corp, you can compare the effects of market volatilities on Financial and Mako 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 Financial with a short position of Mako Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Financial and Mako Mining.
Diversification Opportunities for Financial and Mako Mining
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Financial and Mako is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Financial 15 Split and Mako Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mako Mining Corp and Financial 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 Financial 15 Split are associated (or correlated) with Mako Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mako Mining Corp has no effect on the direction of Financial i.e., Financial and Mako Mining go up and down completely randomly.
Pair Corralation between Financial and Mako Mining
Assuming the 90 days trading horizon Financial 15 Split is expected to generate 0.1 times more return on investment than Mako Mining. However, Financial 15 Split is 10.4 times less risky than Mako Mining. It trades about 0.24 of its potential returns per unit of risk. Mako Mining Corp is currently generating about -0.03 per unit of risk. If you would invest 984.00 in Financial 15 Split on September 2, 2024 and sell it today you would earn a total of 75.00 from holding Financial 15 Split or generate 7.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Financial 15 Split vs. Mako Mining Corp
Performance |
| Timeline |
| Financial 15 Split |
| Mako Mining Corp |
Financial and Mako Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Financial and Mako Mining
The main advantage of trading using opposite Financial and Mako Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Financial position performs unexpectedly, Mako 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 Mako Mining will offset losses from the drop in Mako Mining's long position.| Financial vs. North American Financial | Financial vs. Dividend 15 Split | Financial vs. Dividend Growth Split | Financial vs. Dividend 15 Split |
| Mako Mining vs. First Majestic Silver | Mako Mining vs. Ivanhoe Energy | Mako Mining vs. Orezone Gold 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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