Correlation Between Metals Exploration and Xeros Technology
Can any of the company-specific risk be diversified away by investing in both Metals Exploration and Xeros Technology 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 Metals Exploration and Xeros Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metals Exploration Plc and Xeros Technology Group, you can compare the effects of market volatilities on Metals Exploration and Xeros Technology 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 Metals Exploration with a short position of Xeros Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metals Exploration and Xeros Technology.
Diversification Opportunities for Metals Exploration and Xeros Technology
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Metals and Xeros is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Metals Exploration Plc and Xeros Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xeros Technology and Metals Exploration 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 Metals Exploration Plc are associated (or correlated) with Xeros Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xeros Technology has no effect on the direction of Metals Exploration i.e., Metals Exploration and Xeros Technology go up and down completely randomly.
Pair Corralation between Metals Exploration and Xeros Technology
Assuming the 90 days trading horizon Metals Exploration Plc is expected to generate 0.85 times more return on investment than Xeros Technology. However, Metals Exploration Plc is 1.17 times less risky than Xeros Technology. It trades about 0.07 of its potential returns per unit of risk. Xeros Technology Group is currently generating about -0.07 per unit of risk. If you would invest 185.00 in Metals Exploration Plc on November 5, 2024 and sell it today you would earn a total of 335.00 from holding Metals Exploration Plc or generate 181.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metals Exploration Plc vs. Xeros Technology Group
Performance |
| Timeline |
| Metals Exploration Plc |
| Xeros Technology |
Metals Exploration and Xeros Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metals Exploration and Xeros Technology
The main advantage of trading using opposite Metals Exploration and Xeros Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metals Exploration position performs unexpectedly, Xeros Technology 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 Xeros Technology will offset losses from the drop in Xeros Technology's long position.| Metals Exploration vs. Beazer Homes USA | Metals Exploration vs. American Homes 4 | Metals Exploration vs. Dalata Hotel Group | Metals Exploration vs. Odfjell Drilling |
| Xeros Technology vs. Bloomsbury Publishing Plc | Xeros Technology vs. Ecclesiastical Insurance Office | Xeros Technology vs. Eastinco Mining Exploration | Xeros Technology vs. Atalaya Mining |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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