Correlation Between Monument Mining and Medical Facilities
Can any of the company-specific risk be diversified away by investing in both Monument Mining and Medical Facilities 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 Monument Mining and Medical Facilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monument Mining Limited and Medical Facilities, you can compare the effects of market volatilities on Monument Mining and Medical Facilities 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 Monument Mining with a short position of Medical Facilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monument Mining and Medical Facilities.
Diversification Opportunities for Monument Mining and Medical Facilities
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Monument and Medical is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Monument Mining Limited and Medical Facilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medical Facilities and Monument 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 Monument Mining Limited are associated (or correlated) with Medical Facilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medical Facilities has no effect on the direction of Monument Mining i.e., Monument Mining and Medical Facilities go up and down completely randomly.
Pair Corralation between Monument Mining and Medical Facilities
Assuming the 90 days horizon Monument Mining Limited is expected to generate 3.17 times more return on investment than Medical Facilities. However, Monument Mining is 3.17 times more volatile than Medical Facilities. It trades about 0.08 of its potential returns per unit of risk. Medical Facilities is currently generating about 0.13 per unit of risk. If you would invest 12.00 in Monument Mining Limited on October 1, 2024 and sell it today you would earn a total of 16.00 from holding Monument Mining Limited or generate 133.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Monument Mining Limited vs. Medical Facilities
Performance |
| Timeline |
| Monument Mining |
| Medical Facilities |
Monument Mining and Medical Facilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monument Mining and Medical Facilities
The main advantage of trading using opposite Monument Mining and Medical Facilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monument Mining position performs unexpectedly, Medical Facilities 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 Medical Facilities will offset losses from the drop in Medical Facilities' long position.| Monument Mining vs. Majestic Gold Corp | Monument Mining vs. Gunpoint Exploration | Monument Mining vs. Q Gold Resources | Monument Mining vs. MAS Gold Corp |
| Medical Facilities vs. Extendicare | Medical Facilities vs. Sienna Senior Living | Medical Facilities vs. Rogers Sugar | Medical Facilities vs. Chemtrade Logistics Income |
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 CEOs Directory module to screen CEOs from public companies around the world.
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