Correlation Between Infinico Metals and PJX Resources
Can any of the company-specific risk be diversified away by investing in both Infinico Metals and PJX Resources 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 PJX Resources 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 PJX Resources, you can compare the effects of market volatilities on Infinico Metals and PJX Resources 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 PJX Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infinico Metals and PJX Resources.
Diversification Opportunities for Infinico Metals and PJX Resources
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Infinico and PJX is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Infinico Metals Corp and PJX Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PJX Resources 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 PJX Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PJX Resources has no effect on the direction of Infinico Metals i.e., Infinico Metals and PJX Resources go up and down completely randomly.
Pair Corralation between Infinico Metals and PJX Resources
Assuming the 90 days trading horizon Infinico Metals Corp is expected to under-perform the PJX Resources. In addition to that, Infinico Metals is 1.17 times more volatile than PJX Resources. It trades about -0.17 of its total potential returns per unit of risk. PJX Resources is currently generating about -0.09 per unit of volatility. If you would invest 14.00 in PJX Resources on August 29, 2024 and sell it today you would lose (3.00) from holding PJX Resources or give up 21.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 86.96% |
| Values | Daily Returns |
Infinico Metals Corp vs. PJX Resources
Performance |
| Timeline |
| Infinico Metals Corp |
| PJX Resources |
Infinico Metals and PJX Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Infinico Metals and PJX Resources
The main advantage of trading using opposite Infinico Metals and PJX Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Infinico Metals position performs unexpectedly, PJX Resources 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 PJX Resources will offset losses from the drop in PJX Resources' long position.| Infinico Metals vs. Rubicon Organics | Infinico Metals vs. T2 Metals Corp | Infinico Metals vs. Maple Leaf Foods | Infinico Metals vs. Intact Financial Corp |
| PJX Resources vs. First Majestic Silver | PJX Resources vs. Ivanhoe Energy | PJX Resources vs. Orezone Gold Corp | PJX Resources vs. Faraday Copper 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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