Correlation Between Themac Resources and Ascendant Resources
Can any of the company-specific risk be diversified away by investing in both Themac Resources and Ascendant Resources 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 Themac Resources and Ascendant Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Themac Resources Group and Ascendant Resources, you can compare the effects of market volatilities on Themac Resources and Ascendant Resources 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 Themac Resources with a short position of Ascendant Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Themac Resources and Ascendant Resources.
Diversification Opportunities for Themac Resources and Ascendant Resources
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Themac and Ascendant is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Themac Resources Group and Ascendant Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ascendant Resources and Themac 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 Themac Resources Group are associated (or correlated) with Ascendant Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ascendant Resources has no effect on the direction of Themac Resources i.e., Themac Resources and Ascendant Resources go up and down completely randomly.
Pair Corralation between Themac Resources and Ascendant Resources
Assuming the 90 days horizon Themac Resources Group is expected to generate 1.61 times more return on investment than Ascendant Resources. However, Themac Resources is 1.61 times more volatile than Ascendant Resources. It trades about 0.07 of its potential returns per unit of risk. Ascendant Resources is currently generating about 0.02 per unit of risk. If you would invest 2.41 in Themac Resources Group on August 25, 2024 and sell it today you would earn a total of 1.79 from holding Themac Resources Group or generate 74.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Themac Resources Group vs. Ascendant Resources
Performance |
| Timeline |
| Themac Resources |
| Ascendant Resources |
Themac Resources and Ascendant Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Themac Resources and Ascendant Resources
The main advantage of trading using opposite Themac Resources and Ascendant Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Themac Resources position performs unexpectedly, Ascendant Resources 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 Ascendant Resources will offset losses from the drop in Ascendant Resources' long position.| Themac Resources vs. Ascendant Resources | Themac Resources vs. Cantex Mine Development | Themac Resources vs. Amarc Resources | Themac Resources vs. Sterling Metals Corp |
| Ascendant Resources vs. Norra Metals Corp | Ascendant Resources vs. ZincX Resources Corp | Ascendant Resources vs. Nuinsco Resources Limited | Ascendant Resources vs. South Star Battery |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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