Correlation Between Themac Resources and Boss Resources
Can any of the company-specific risk be diversified away by investing in both Themac Resources and Boss 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 Boss 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 Boss Resources, you can compare the effects of market volatilities on Themac Resources and Boss 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 Boss Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Themac Resources and Boss Resources.
Diversification Opportunities for Themac Resources and Boss Resources
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Themac and Boss is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Themac Resources Group and Boss Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boss 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 Boss Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boss Resources has no effect on the direction of Themac Resources i.e., Themac Resources and Boss Resources go up and down completely randomly.
Pair Corralation between Themac Resources and Boss Resources
Assuming the 90 days horizon Themac Resources Group is expected to generate 4.31 times more return on investment than Boss Resources. However, Themac Resources is 4.31 times more volatile than Boss Resources. It trades about 0.07 of its potential returns per unit of risk. Boss 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 Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Themac Resources Group vs. Boss Resources
Performance |
| Timeline |
| Themac Resources |
| Boss Resources |
Themac Resources and Boss Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Themac Resources and Boss Resources
The main advantage of trading using opposite Themac Resources and Boss Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Themac Resources position performs unexpectedly, Boss 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 Boss Resources will offset losses from the drop in Boss 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 |
| Boss Resources vs. Norra Metals Corp | Boss Resources vs. ZincX Resources Corp | Boss Resources vs. Nuinsco Resources Limited | Boss 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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