Correlation Between Osisko Metals and Centaurus Metals
Can any of the company-specific risk be diversified away by investing in both Osisko Metals and Centaurus 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 Osisko Metals and Centaurus Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Osisko Metals Incorporated and Centaurus Metals Limited, you can compare the effects of market volatilities on Osisko Metals and Centaurus 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 Osisko Metals with a short position of Centaurus Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Osisko Metals and Centaurus Metals.
Diversification Opportunities for Osisko Metals and Centaurus Metals
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Osisko and Centaurus is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Osisko Metals Incorporated and Centaurus Metals Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centaurus Metals and Osisko Metals 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 Osisko Metals Incorporated are associated (or correlated) with Centaurus Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centaurus Metals has no effect on the direction of Osisko Metals i.e., Osisko Metals and Centaurus Metals go up and down completely randomly.
Pair Corralation between Osisko Metals and Centaurus Metals
Assuming the 90 days horizon Osisko Metals Incorporated is expected to generate 1.1 times more return on investment than Centaurus Metals. However, Osisko Metals is 1.1 times more volatile than Centaurus Metals Limited. It trades about 0.08 of its potential returns per unit of risk. Centaurus Metals Limited is currently generating about -0.04 per unit of risk. If you would invest 16.00 in Osisko Metals Incorporated on September 1, 2024 and sell it today you would earn a total of 1.00 from holding Osisko Metals Incorporated or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Osisko Metals Incorporated vs. Centaurus Metals Limited
Performance |
| Timeline |
| Osisko Metals |
| Centaurus Metals |
Osisko Metals and Centaurus Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Osisko Metals and Centaurus Metals
The main advantage of trading using opposite Osisko Metals and Centaurus Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Osisko Metals position performs unexpectedly, Centaurus 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 Centaurus Metals will offset losses from the drop in Centaurus Metals' long position.| Osisko Metals vs. ATT Inc | Osisko Metals vs. Merck Company | Osisko Metals vs. Walt Disney | Osisko Metals vs. Caterpillar |
| Centaurus Metals vs. Edison Cobalt Corp | Centaurus Metals vs. Baroyeca Gold Silver | Centaurus Metals vs. Aurelia Metals Limited | Centaurus Metals vs. China Rare Earth |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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