Correlation Between MAGNUM MINING and SIMS METAL
Can any of the company-specific risk be diversified away by investing in both MAGNUM MINING and SIMS METAL 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 MAGNUM MINING and SIMS METAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAGNUM MINING EXP and SIMS METAL MGT, you can compare the effects of market volatilities on MAGNUM MINING and SIMS METAL 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 MAGNUM MINING with a short position of SIMS METAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAGNUM MINING and SIMS METAL.
Diversification Opportunities for MAGNUM MINING and SIMS METAL
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MAGNUM and SIMS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MAGNUM MINING EXP and SIMS METAL MGT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIMS METAL MGT and MAGNUM 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 MAGNUM MINING EXP are associated (or correlated) with SIMS METAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIMS METAL MGT has no effect on the direction of MAGNUM MINING i.e., MAGNUM MINING and SIMS METAL go up and down completely randomly.
Pair Corralation between MAGNUM MINING and SIMS METAL
If you would invest 6.08 in MAGNUM MINING EXP on September 13, 2024 and sell it today you would earn a total of 0.00 from holding MAGNUM MINING EXP or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MAGNUM MINING EXP vs. SIMS METAL MGT
Performance |
| Timeline |
| MAGNUM MINING EXP |
| SIMS METAL MGT |
MAGNUM MINING and SIMS METAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAGNUM MINING and SIMS METAL
The main advantage of trading using opposite MAGNUM MINING and SIMS METAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAGNUM MINING position performs unexpectedly, SIMS METAL 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 SIMS METAL will offset losses from the drop in SIMS METAL's long position.| MAGNUM MINING vs. Apple Inc | MAGNUM MINING vs. Apple Inc | MAGNUM MINING vs. Apple Inc | MAGNUM MINING vs. Apple Inc |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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