Correlation Between Maple Leaf and Homerun Resources
Can any of the company-specific risk be diversified away by investing in both Maple Leaf and Homerun 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 Maple Leaf and Homerun Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maple Leaf Foods and Homerun Resources, you can compare the effects of market volatilities on Maple Leaf and Homerun 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 Maple Leaf with a short position of Homerun Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maple Leaf and Homerun Resources.
Diversification Opportunities for Maple Leaf and Homerun Resources
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Maple and Homerun is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Maple Leaf Foods and Homerun Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Homerun Resources and Maple Leaf 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 Maple Leaf Foods are associated (or correlated) with Homerun Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Homerun Resources has no effect on the direction of Maple Leaf i.e., Maple Leaf and Homerun Resources go up and down completely randomly.
Pair Corralation between Maple Leaf and Homerun Resources
Assuming the 90 days trading horizon Maple Leaf Foods is expected to under-perform the Homerun Resources. But the stock apears to be less risky and, when comparing its historical volatility, Maple Leaf Foods is 3.45 times less risky than Homerun Resources. The stock trades about 0.0 of its potential returns per unit of risk. The Homerun Resources is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 8.50 in Homerun Resources on October 31, 2024 and sell it today you would earn a total of 105.50 from holding Homerun Resources or generate 1241.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maple Leaf Foods vs. Homerun Resources
Performance |
| Timeline |
| Maple Leaf Foods |
| Homerun Resources |
Maple Leaf and Homerun Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maple Leaf and Homerun Resources
The main advantage of trading using opposite Maple Leaf and Homerun Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maple Leaf position performs unexpectedly, Homerun 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 Homerun Resources will offset losses from the drop in Homerun Resources' long position.| Maple Leaf vs. Saputo Inc | Maple Leaf vs. George Weston Limited | Maple Leaf vs. Empire Company Limited | Maple Leaf vs. Premium Brands Holdings |
| Homerun Resources vs. Black Mammoth Metals | Homerun Resources vs. Renoworks Software | Homerun Resources vs. Sun Peak Metals | Homerun Resources vs. Canlan Ice Sports |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |