Correlation Between Litigation Capital and AfriTin Mining
Can any of the company-specific risk be diversified away by investing in both Litigation Capital and AfriTin 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 Litigation Capital and AfriTin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Litigation Capital Management and AfriTin Mining, you can compare the effects of market volatilities on Litigation Capital and AfriTin 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 Litigation Capital with a short position of AfriTin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Litigation Capital and AfriTin Mining.
Diversification Opportunities for Litigation Capital and AfriTin Mining
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Litigation and AfriTin is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Litigation Capital Management and AfriTin Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AfriTin Mining and Litigation Capital 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 Litigation Capital Management are associated (or correlated) with AfriTin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AfriTin Mining has no effect on the direction of Litigation Capital i.e., Litigation Capital and AfriTin Mining go up and down completely randomly.
Pair Corralation between Litigation Capital and AfriTin Mining
Assuming the 90 days trading horizon Litigation Capital Management is expected to generate 0.52 times more return on investment than AfriTin Mining. However, Litigation Capital Management is 1.91 times less risky than AfriTin Mining. It trades about 0.01 of its potential returns per unit of risk. AfriTin Mining is currently generating about -0.04 per unit of risk. If you would invest 9,900 in Litigation Capital Management on October 16, 2024 and sell it today you would earn a total of 0.00 from holding Litigation Capital Management or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Litigation Capital Management vs. AfriTin Mining
Performance |
| Timeline |
| Litigation Capital |
| AfriTin Mining |
Litigation Capital and AfriTin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Litigation Capital and AfriTin Mining
The main advantage of trading using opposite Litigation Capital and AfriTin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Litigation Capital position performs unexpectedly, AfriTin 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 AfriTin Mining will offset losses from the drop in AfriTin Mining's long position.| Litigation Capital vs. Pressure Technologies Plc | Litigation Capital vs. Monster Beverage Corp | Litigation Capital vs. Young Cos Brewery | Litigation Capital vs. Nordic Semiconductor ASA |
| AfriTin Mining vs. Litigation Capital Management | AfriTin Mining vs. Applied Materials | AfriTin Mining vs. Auto Trader Group | AfriTin Mining vs. Universal Music Group |
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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