Correlation Between Infinico Metals and Stellar AfricaGold
Can any of the company-specific risk be diversified away by investing in both Infinico Metals and Stellar AfricaGold 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 Stellar AfricaGold 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 Stellar AfricaGold, you can compare the effects of market volatilities on Infinico Metals and Stellar AfricaGold 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 Stellar AfricaGold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infinico Metals and Stellar AfricaGold.
Diversification Opportunities for Infinico Metals and Stellar AfricaGold
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Infinico and Stellar is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Infinico Metals Corp and Stellar AfricaGold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stellar AfricaGold 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 Stellar AfricaGold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stellar AfricaGold has no effect on the direction of Infinico Metals i.e., Infinico Metals and Stellar AfricaGold go up and down completely randomly.
Pair Corralation between Infinico Metals and Stellar AfricaGold
Assuming the 90 days trading horizon Infinico Metals is expected to generate 1.88 times less return on investment than Stellar AfricaGold. But when comparing it to its historical volatility, Infinico Metals Corp is 1.43 times less risky than Stellar AfricaGold. It trades about 0.03 of its potential returns per unit of risk. Stellar AfricaGold is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 40.00 in Stellar AfricaGold on August 30, 2024 and sell it today you would lose (31.00) from holding Stellar AfricaGold or give up 77.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 80.77% |
| Values | Daily Returns |
Infinico Metals Corp vs. Stellar AfricaGold
Performance |
| Timeline |
| Infinico Metals Corp |
| Stellar AfricaGold |
Infinico Metals and Stellar AfricaGold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Infinico Metals and Stellar AfricaGold
The main advantage of trading using opposite Infinico Metals and Stellar AfricaGold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Infinico Metals position performs unexpectedly, Stellar AfricaGold 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 Stellar AfricaGold will offset losses from the drop in Stellar AfricaGold's 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 |
| Stellar AfricaGold vs. Richmond Minerals | Stellar AfricaGold vs. Societe d Exploration | Stellar AfricaGold vs. Tesoro Minerals 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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