Correlation Between Infinico Metals and Fredonia Mining
Can any of the company-specific risk be diversified away by investing in both Infinico Metals and Fredonia 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 Infinico Metals and Fredonia Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Infinico Metals Corp and Fredonia Mining, you can compare the effects of market volatilities on Infinico Metals and Fredonia 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 Infinico Metals with a short position of Fredonia Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infinico Metals and Fredonia Mining.
Diversification Opportunities for Infinico Metals and Fredonia Mining
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Infinico and Fredonia is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Infinico Metals Corp and Fredonia Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fredonia Mining and Infinico Metals 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 Infinico Metals Corp are associated (or correlated) with Fredonia Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fredonia Mining has no effect on the direction of Infinico Metals i.e., Infinico Metals and Fredonia Mining go up and down completely randomly.
Pair Corralation between Infinico Metals and Fredonia Mining
Assuming the 90 days trading horizon Infinico Metals Corp is expected to generate 1.11 times more return on investment than Fredonia Mining. However, Infinico Metals is 1.11 times more volatile than Fredonia Mining. It trades about 0.03 of its potential returns per unit of risk. Fredonia Mining is currently generating about 0.03 per unit of risk. If you would invest 6.00 in Infinico Metals Corp on December 10, 2024 and sell it today you would lose (4.50) from holding Infinico Metals Corp or give up 75.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 87.07% |
| Values | Daily Returns |
Infinico Metals Corp vs. Fredonia Mining
Performance |
| Timeline |
| Infinico Metals Corp |
| Fredonia Mining |
Infinico Metals and Fredonia Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Infinico Metals and Fredonia Mining
The main advantage of trading using opposite Infinico Metals and Fredonia Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Infinico Metals position performs unexpectedly, Fredonia 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 Fredonia Mining will offset losses from the drop in Fredonia Mining's long position.| Infinico Metals vs. Mako Mining Corp | Infinico Metals vs. Olympia Financial Group | Infinico Metals vs. Pace Metals | Infinico Metals vs. Solution Financial |
| Fredonia Mining vs. CNJ Capital Investments | Fredonia Mining vs. Economic Investment Trust | Fredonia Mining vs. Canadian General Investments | Fredonia Mining vs. Bird Construction |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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