Correlation Between Magna Mining and Wilmington Capital
Can any of the company-specific risk be diversified away by investing in both Magna Mining and Wilmington Capital 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 Magna Mining and Wilmington Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magna Mining and Wilmington Capital Management, you can compare the effects of market volatilities on Magna Mining and Wilmington Capital 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 Magna Mining with a short position of Wilmington Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magna Mining and Wilmington Capital.
Diversification Opportunities for Magna Mining and Wilmington Capital
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Magna and Wilmington is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Magna Mining and Wilmington Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmington Capital and Magna 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 Magna Mining are associated (or correlated) with Wilmington Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmington Capital has no effect on the direction of Magna Mining i.e., Magna Mining and Wilmington Capital go up and down completely randomly.
Pair Corralation between Magna Mining and Wilmington Capital
Assuming the 90 days trading horizon Magna Mining is expected to generate 45.61 times more return on investment than Wilmington Capital. However, Magna Mining is 45.61 times more volatile than Wilmington Capital Management. It trades about 0.2 of its potential returns per unit of risk. Wilmington Capital Management is currently generating about -0.22 per unit of risk. If you would invest 142.00 in Magna Mining on November 2, 2024 and sell it today you would earn a total of 25.00 from holding Magna Mining or generate 17.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Magna Mining vs. Wilmington Capital Management
Performance |
| Timeline |
| Magna Mining |
| Wilmington Capital |
Magna Mining and Wilmington Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magna Mining and Wilmington Capital
The main advantage of trading using opposite Magna Mining and Wilmington Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magna Mining position performs unexpectedly, Wilmington Capital 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 Wilmington Capital will offset losses from the drop in Wilmington Capital's long position.| Magna Mining vs. Brunswick Exploration | Magna Mining vs. Fireweed Zinc | Magna Mining vs. Emerita Resources Corp | Magna Mining vs. InZinc Mining |
| Wilmington Capital vs. High Liner Foods | Wilmington Capital vs. Labrador Iron Ore | Wilmington Capital vs. Western Copper and | Wilmington Capital vs. Magna 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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