Correlation Between Monks Investment and Cornish Metals
Can any of the company-specific risk be diversified away by investing in both Monks Investment and Cornish Metals 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 Monks Investment and Cornish Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monks Investment Trust and Cornish Metals, you can compare the effects of market volatilities on Monks Investment and Cornish Metals 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 Monks Investment with a short position of Cornish Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monks Investment and Cornish Metals.
Diversification Opportunities for Monks Investment and Cornish Metals
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Monks and Cornish is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Monks Investment Trust and Cornish Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cornish Metals and Monks Investment 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 Monks Investment Trust are associated (or correlated) with Cornish Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cornish Metals has no effect on the direction of Monks Investment i.e., Monks Investment and Cornish Metals go up and down completely randomly.
Pair Corralation between Monks Investment and Cornish Metals
Assuming the 90 days trading horizon Monks Investment Trust is expected to generate 0.27 times more return on investment than Cornish Metals. However, Monks Investment Trust is 3.72 times less risky than Cornish Metals. It trades about 0.06 of its potential returns per unit of risk. Cornish Metals is currently generating about -0.01 per unit of risk. If you would invest 98,104 in Monks Investment Trust on September 4, 2024 and sell it today you would earn a total of 29,696 from holding Monks Investment Trust or generate 30.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Monks Investment Trust vs. Cornish Metals
Performance |
| Timeline |
| Monks Investment Trust |
| Cornish Metals |
Monks Investment and Cornish Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monks Investment and Cornish Metals
The main advantage of trading using opposite Monks Investment and Cornish Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monks Investment position performs unexpectedly, Cornish Metals 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 Cornish Metals will offset losses from the drop in Cornish Metals' long position.| Monks Investment vs. SupplyMe Capital PLC | Monks Investment vs. Lloyds Banking Group | Monks Investment vs. Premier African Minerals | Monks Investment vs. SANTANDER UK 8 |
| Cornish Metals vs. Antofagasta PLC | Cornish Metals vs. Atalaya Mining | Cornish Metals vs. Ferrexpo PLC | Cornish Metals vs. Amaroq Minerals |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |