Correlation Between Millbank Mining and Maple Leaf
Can any of the company-specific risk be diversified away by investing in both Millbank Mining and Maple Leaf 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 Maple Leaf 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 Maple Leaf Foods, you can compare the effects of market volatilities on Millbank Mining and Maple Leaf 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 Maple Leaf. Check out your portfolio center. Please also check ongoing floating volatility patterns of Millbank Mining and Maple Leaf.
Diversification Opportunities for Millbank Mining and Maple Leaf
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Millbank and Maple is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Millbank Mining Corp and Maple Leaf Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maple Leaf Foods 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 Maple Leaf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maple Leaf Foods has no effect on the direction of Millbank Mining i.e., Millbank Mining and Maple Leaf go up and down completely randomly.
Pair Corralation between Millbank Mining and Maple Leaf
Assuming the 90 days trading horizon Millbank Mining Corp is expected to generate 2.04 times more return on investment than Maple Leaf. However, Millbank Mining is 2.04 times more volatile than Maple Leaf Foods. It trades about -0.01 of its potential returns per unit of risk. Maple Leaf Foods is currently generating about -0.26 per unit of risk. If you would invest 50.00 in Millbank Mining Corp on September 23, 2024 and sell it today you would lose (1.00) from holding Millbank Mining Corp or give up 2.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Millbank Mining Corp vs. Maple Leaf Foods
Performance |
| Timeline |
| Millbank Mining Corp |
| Maple Leaf Foods |
Millbank Mining and Maple Leaf Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Millbank Mining and Maple Leaf
The main advantage of trading using opposite Millbank Mining and Maple Leaf positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Millbank Mining position performs unexpectedly, Maple Leaf 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 Maple Leaf will offset losses from the drop in Maple Leaf's long position.| Millbank Mining vs. Maple Leaf Foods | Millbank Mining vs. Olympia Financial Group | Millbank Mining vs. iA Financial | Millbank Mining vs. Caribbean Utilities |
| Maple Leaf vs. Saputo Inc | Maple Leaf vs. Empire Company Limited | Maple Leaf vs. Premium Brands Holdings | Maple Leaf vs. Metro Inc |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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