Correlation Between Themac Resources and CanAlaska Uranium
Can any of the company-specific risk be diversified away by investing in both Themac Resources and CanAlaska Uranium 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 CanAlaska Uranium 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 CanAlaska Uranium, you can compare the effects of market volatilities on Themac Resources and CanAlaska Uranium 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 CanAlaska Uranium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Themac Resources and CanAlaska Uranium.
Diversification Opportunities for Themac Resources and CanAlaska Uranium
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Themac and CanAlaska is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Themac Resources Group and CanAlaska Uranium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CanAlaska Uranium 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 CanAlaska Uranium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CanAlaska Uranium has no effect on the direction of Themac Resources i.e., Themac Resources and CanAlaska Uranium go up and down completely randomly.
Pair Corralation between Themac Resources and CanAlaska Uranium
Assuming the 90 days horizon Themac Resources Group is expected to generate 5.45 times more return on investment than CanAlaska Uranium. However, Themac Resources is 5.45 times more volatile than CanAlaska Uranium. It trades about 0.21 of its potential returns per unit of risk. CanAlaska Uranium is currently generating about 0.01 per unit of risk. If you would invest 2.50 in Themac Resources Group on August 29, 2024 and sell it today you would earn a total of 1.70 from holding Themac Resources Group or generate 68.0% 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. CanAlaska Uranium
Performance |
| Timeline |
| Themac Resources |
| CanAlaska Uranium |
Themac Resources and CanAlaska Uranium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Themac Resources and CanAlaska Uranium
The main advantage of trading using opposite Themac Resources and CanAlaska Uranium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Themac Resources position performs unexpectedly, CanAlaska Uranium 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 CanAlaska Uranium will offset losses from the drop in CanAlaska Uranium's long position.| Themac Resources vs. Ascendant Resources | Themac Resources vs. Cantex Mine Development | Themac Resources vs. Amarc Resources | Themac Resources vs. Sterling Metals Corp |
| CanAlaska Uranium vs. Forum Energy Metals | CanAlaska Uranium vs. Namibia Critical Metals | CanAlaska Uranium vs. Themac Resources Group | CanAlaska Uranium vs. Pasinex Resources Limited |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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