Correlation Between Peak Minerals and Aya Gold
Can any of the company-specific risk be diversified away by investing in both Peak Minerals and Aya Gold 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 Peak Minerals and Aya Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peak Minerals Limited and Aya Gold Silver, you can compare the effects of market volatilities on Peak Minerals and Aya Gold 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 Peak Minerals with a short position of Aya Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peak Minerals and Aya Gold.
Diversification Opportunities for Peak Minerals and Aya Gold
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Peak and Aya is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Peak Minerals Limited and Aya Gold Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aya Gold Silver and Peak Minerals 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 Peak Minerals Limited are associated (or correlated) with Aya Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aya Gold Silver has no effect on the direction of Peak Minerals i.e., Peak Minerals and Aya Gold go up and down completely randomly.
Pair Corralation between Peak Minerals and Aya Gold
Assuming the 90 days horizon Peak Minerals Limited is expected to generate 2.54 times more return on investment than Aya Gold. However, Peak Minerals is 2.54 times more volatile than Aya Gold Silver. It trades about 0.32 of its potential returns per unit of risk. Aya Gold Silver is currently generating about 0.08 per unit of risk. If you would invest 0.40 in Peak Minerals Limited on October 25, 2024 and sell it today you would earn a total of 0.25 from holding Peak Minerals Limited or generate 62.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Peak Minerals Limited vs. Aya Gold Silver
Performance |
| Timeline |
| Peak Minerals Limited |
| Aya Gold Silver |
Peak Minerals and Aya Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peak Minerals and Aya Gold
The main advantage of trading using opposite Peak Minerals and Aya Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peak Minerals position performs unexpectedly, Aya Gold 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 Aya Gold will offset losses from the drop in Aya Gold's long position.| Peak Minerals vs. BOSTON BEER A | Peak Minerals vs. SAN MIGUEL BREWERY | Peak Minerals vs. FANDIFI TECHNOLOGY P | Peak Minerals vs. Kingdee International Software |
| Aya Gold vs. Semiconductor Manufacturing International | Aya Gold vs. Transport International Holdings | Aya Gold vs. TOREX SEMICONDUCTOR LTD | Aya Gold vs. Nippon Light Metal |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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