Correlation Between 3I Group and Beowulf Mining
Can any of the company-specific risk be diversified away by investing in both 3I Group and Beowulf 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 3I Group and Beowulf Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 3I Group PLC and Beowulf Mining, you can compare the effects of market volatilities on 3I Group and Beowulf 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 3I Group with a short position of Beowulf Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of 3I Group and Beowulf Mining.
Diversification Opportunities for 3I Group and Beowulf Mining
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between III and Beowulf is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding 3I Group PLC and Beowulf Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beowulf Mining and 3I Group 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 3I Group PLC are associated (or correlated) with Beowulf Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beowulf Mining has no effect on the direction of 3I Group i.e., 3I Group and Beowulf Mining go up and down completely randomly.
Pair Corralation between 3I Group and Beowulf Mining
Assuming the 90 days trading horizon 3I Group PLC is expected to generate 0.26 times more return on investment than Beowulf Mining. However, 3I Group PLC is 3.83 times less risky than Beowulf Mining. It trades about 0.15 of its potential returns per unit of risk. Beowulf Mining is currently generating about -0.06 per unit of risk. If you would invest 192,107 in 3I Group PLC on October 28, 2024 and sell it today you would earn a total of 190,693 from holding 3I Group PLC or generate 99.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
3I Group PLC vs. Beowulf Mining
Performance |
| Timeline |
| 3I Group PLC |
| Beowulf Mining |
3I Group and Beowulf Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 3I Group and Beowulf Mining
The main advantage of trading using opposite 3I Group and Beowulf Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 3I Group position performs unexpectedly, Beowulf 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 Beowulf Mining will offset losses from the drop in Beowulf Mining's long position.| 3I Group vs. Europa Metals | 3I Group vs. Adriatic Metals | 3I Group vs. Compagnie Plastic Omnium | 3I Group vs. EJF Investments |
| Beowulf Mining vs. CNH Industrial NV | Beowulf Mining vs. Grieg Seafood | Beowulf Mining vs. GreenX Metals | Beowulf Mining vs. Eastinco Mining Exploration |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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