Correlation Between Millbank Mining and Canaf Investments
Can any of the company-specific risk be diversified away by investing in both Millbank Mining and Canaf Investments 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 Millbank Mining and Canaf Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Millbank Mining Corp and Canaf Investments, you can compare the effects of market volatilities on Millbank Mining and Canaf Investments 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 Millbank Mining with a short position of Canaf Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Millbank Mining and Canaf Investments.
Diversification Opportunities for Millbank Mining and Canaf Investments
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Millbank and Canaf is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Millbank Mining Corp and Canaf Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canaf Investments and Millbank 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 Millbank Mining Corp are associated (or correlated) with Canaf Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canaf Investments has no effect on the direction of Millbank Mining i.e., Millbank Mining and Canaf Investments go up and down completely randomly.
Pair Corralation between Millbank Mining and Canaf Investments
Assuming the 90 days trading horizon Millbank Mining Corp is expected to under-perform the Canaf Investments. In addition to that, Millbank Mining is 1.05 times more volatile than Canaf Investments. It trades about -0.02 of its total potential returns per unit of risk. Canaf Investments is currently generating about 0.2 per unit of volatility. If you would invest 28.00 in Canaf Investments on October 25, 2024 and sell it today you would earn a total of 7.00 from holding Canaf Investments or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 85.0% |
| Values | Daily Returns |
Millbank Mining Corp vs. Canaf Investments
Performance |
| Timeline |
| Millbank Mining Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Canaf Investments |
Millbank Mining and Canaf Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Millbank Mining and Canaf Investments
The main advantage of trading using opposite Millbank Mining and Canaf Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Millbank Mining position performs unexpectedly, Canaf Investments 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 Canaf Investments will offset losses from the drop in Canaf Investments' long position.| Millbank Mining vs. Titanium Transportation Group | Millbank Mining vs. TGS Esports | Millbank Mining vs. Algonquin Power Utilities | Millbank Mining vs. CVW CleanTech |
| Canaf Investments vs. Contagious Gaming | Canaf Investments vs. Renoworks Software | Canaf Investments vs. Brookfield Investments | Canaf Investments vs. Northstar Clean Technologies |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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