Correlation Between K92 Mining and Jaguar Mining
Can any of the company-specific risk be diversified away by investing in both K92 Mining and Jaguar 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 K92 Mining and Jaguar Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between K92 Mining and Jaguar Mining, you can compare the effects of market volatilities on K92 Mining and Jaguar 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 K92 Mining with a short position of Jaguar Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of K92 Mining and Jaguar Mining.
Diversification Opportunities for K92 Mining and Jaguar Mining
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between K92 and Jaguar is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding K92 Mining and Jaguar Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jaguar Mining and K92 Mining 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 K92 Mining are associated (or correlated) with Jaguar Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jaguar Mining has no effect on the direction of K92 Mining i.e., K92 Mining and Jaguar Mining go up and down completely randomly.
Pair Corralation between K92 Mining and Jaguar Mining
Assuming the 90 days horizon K92 Mining is expected to generate 0.72 times more return on investment than Jaguar Mining. However, K92 Mining is 1.38 times less risky than Jaguar Mining. It trades about -0.05 of its potential returns per unit of risk. Jaguar Mining is currently generating about -0.21 per unit of risk. If you would invest 665.00 in K92 Mining on September 1, 2024 and sell it today you would lose (22.00) from holding K92 Mining or give up 3.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
K92 Mining vs. Jaguar Mining
Performance |
| Timeline |
| K92 Mining |
| Jaguar Mining |
K92 Mining and Jaguar Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with K92 Mining and Jaguar Mining
The main advantage of trading using opposite K92 Mining and Jaguar Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if K92 Mining position performs unexpectedly, Jaguar 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 Jaguar Mining will offset losses from the drop in Jaguar Mining's long position.| K92 Mining vs. South32 Limited | K92 Mining vs. NioCorp Developments Ltd | K92 Mining vs. HUMANA INC | K92 Mining vs. SCOR PK |
| Jaguar Mining vs. South32 Limited | Jaguar Mining vs. NioCorp Developments Ltd | Jaguar Mining vs. HUMANA INC | Jaguar Mining vs. SCOR PK |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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