Correlation Between MC Mining and EMedia Holdings
Can any of the company-specific risk be diversified away by investing in both MC Mining and EMedia Holdings 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 MC Mining and EMedia Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MC Mining and eMedia Holdings Limited, you can compare the effects of market volatilities on MC Mining and EMedia Holdings 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 MC Mining with a short position of EMedia Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of MC Mining and EMedia Holdings.
Diversification Opportunities for MC Mining and EMedia Holdings
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MCZ and EMedia is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding MC Mining and eMedia Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on eMedia Holdings and MC 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 MC Mining are associated (or correlated) with EMedia Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of eMedia Holdings has no effect on the direction of MC Mining i.e., MC Mining and EMedia Holdings go up and down completely randomly.
Pair Corralation between MC Mining and EMedia Holdings
Assuming the 90 days trading horizon MC Mining is expected to generate 6.15 times less return on investment than EMedia Holdings. In addition to that, MC Mining is 1.95 times more volatile than eMedia Holdings Limited. It trades about 0.0 of its total potential returns per unit of risk. eMedia Holdings Limited is currently generating about 0.04 per unit of volatility. If you would invest 32,000 in eMedia Holdings Limited on September 14, 2024 and sell it today you would earn a total of 5,500 from holding eMedia Holdings Limited or generate 17.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MC Mining vs. eMedia Holdings Limited
Performance |
| Timeline |
| MC Mining |
| eMedia Holdings |
MC Mining and EMedia Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MC Mining and EMedia Holdings
The main advantage of trading using opposite MC Mining and EMedia Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MC Mining position performs unexpectedly, EMedia Holdings 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 EMedia Holdings will offset losses from the drop in EMedia Holdings' long position.| MC Mining vs. Sasol Ltd Bee | MC Mining vs. Centaur Bci Balanced | MC Mining vs. Growthpoint Properties | MC Mining vs. Coronation Global Equity |
| EMedia Holdings vs. E Media Holdings | EMedia Holdings vs. Sasol Ltd Bee | EMedia Holdings vs. Centaur Bci Balanced | EMedia Holdings vs. Sabvest Capital |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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