Correlation Between Peak Resources and OFFICE DEPOT
Can any of the company-specific risk be diversified away by investing in both Peak Resources and OFFICE DEPOT 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 Peak Resources and OFFICE DEPOT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peak Resources Limited and OFFICE DEPOT, you can compare the effects of market volatilities on Peak Resources and OFFICE DEPOT 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 Peak Resources with a short position of OFFICE DEPOT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peak Resources and OFFICE DEPOT.
Diversification Opportunities for Peak Resources and OFFICE DEPOT
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Peak and OFFICE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Peak Resources Limited and OFFICE DEPOT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFFICE DEPOT and Peak Resources 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 Peak Resources Limited are associated (or correlated) with OFFICE DEPOT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFFICE DEPOT has no effect on the direction of Peak Resources i.e., Peak Resources and OFFICE DEPOT go up and down completely randomly.
Pair Corralation between Peak Resources and OFFICE DEPOT
If you would invest 5.80 in Peak Resources Limited on September 12, 2024 and sell it today you would earn a total of 0.70 from holding Peak Resources Limited or generate 12.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peak Resources Limited vs. OFFICE DEPOT
Performance |
| Timeline |
| Peak Resources |
| OFFICE DEPOT |
Peak Resources and OFFICE DEPOT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peak Resources and OFFICE DEPOT
The main advantage of trading using opposite Peak Resources and OFFICE DEPOT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peak Resources position performs unexpectedly, OFFICE DEPOT 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 OFFICE DEPOT will offset losses from the drop in OFFICE DEPOT's long position.| Peak Resources vs. NEWELL RUBBERMAID | Peak Resources vs. The Yokohama Rubber | Peak Resources vs. Hyster Yale Materials Handling | Peak Resources vs. Park Hotels Resorts |
| OFFICE DEPOT vs. GRIFFIN MINING LTD | OFFICE DEPOT vs. Dairy Farm International | OFFICE DEPOT vs. GALENA MINING LTD | OFFICE DEPOT vs. Penta Ocean Construction Co |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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