Correlation Between Impala Platinum and MC Mining
Can any of the company-specific risk be diversified away by investing in both Impala Platinum and MC 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 Impala Platinum and MC Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impala Platinum Holdings and MC Mining, you can compare the effects of market volatilities on Impala Platinum and MC 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 Impala Platinum with a short position of MC Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impala Platinum and MC Mining.
Diversification Opportunities for Impala Platinum and MC Mining
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Impala and MCZ is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Impala Platinum Holdings and MC Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MC Mining and Impala Platinum 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 Impala Platinum Holdings are associated (or correlated) with MC Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MC Mining has no effect on the direction of Impala Platinum i.e., Impala Platinum and MC Mining go up and down completely randomly.
Pair Corralation between Impala Platinum and MC Mining
Assuming the 90 days trading horizon Impala Platinum Holdings is expected to generate 0.75 times more return on investment than MC Mining. However, Impala Platinum Holdings is 1.33 times less risky than MC Mining. It trades about 0.0 of its potential returns per unit of risk. MC Mining is currently generating about 0.0 per unit of risk. If you would invest 1,242,056 in Impala Platinum Holdings on August 28, 2024 and sell it today you would lose (229,356) from holding Impala Platinum Holdings or give up 18.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
Impala Platinum Holdings vs. MC Mining
Performance |
| Timeline |
| Impala Platinum Holdings |
| MC Mining |
Impala Platinum and MC Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impala Platinum and MC Mining
The main advantage of trading using opposite Impala Platinum and MC Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impala Platinum position performs unexpectedly, MC 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 MC Mining will offset losses from the drop in MC Mining's long position.The idea behind Impala Platinum Holdings and MC Mining pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| MC Mining vs. Centaur Bci Balanced | MC Mining vs. Growthpoint Properties | MC Mining vs. Bowler Metcalf | MC Mining vs. Shoprite Holdings |
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 CEOs Directory module to screen CEOs from public companies around the world.
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