Correlation Between Perseus Mining and Howden Joinery
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Howden Joinery 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 Perseus Mining and Howden Joinery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Perseus Mining Limited and Howden Joinery Group, you can compare the effects of market volatilities on Perseus Mining and Howden Joinery 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 Perseus Mining with a short position of Howden Joinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Howden Joinery.
Diversification Opportunities for Perseus Mining and Howden Joinery
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Perseus and Howden is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and Howden Joinery Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Howden Joinery Group and Perseus 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 Perseus Mining Limited are associated (or correlated) with Howden Joinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Howden Joinery Group has no effect on the direction of Perseus Mining i.e., Perseus Mining and Howden Joinery go up and down completely randomly.
Pair Corralation between Perseus Mining and Howden Joinery
Assuming the 90 days horizon Perseus Mining Limited is expected to generate 0.83 times more return on investment than Howden Joinery. However, Perseus Mining Limited is 1.21 times less risky than Howden Joinery. It trades about 0.12 of its potential returns per unit of risk. Howden Joinery Group is currently generating about -0.11 per unit of risk. If you would invest 158.00 in Perseus Mining Limited on October 20, 2024 and sell it today you would earn a total of 5.00 from holding Perseus Mining Limited or generate 3.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perseus Mining Limited vs. Howden Joinery Group
Performance |
| Timeline |
| Perseus Mining |
| Howden Joinery Group |
Perseus Mining and Howden Joinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and Howden Joinery
The main advantage of trading using opposite Perseus Mining and Howden Joinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Howden Joinery 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 Howden Joinery will offset losses from the drop in Howden Joinery's long position.| Perseus Mining vs. Webster Financial | Perseus Mining vs. PNC Financial Services | Perseus Mining vs. GRUPO CARSO A1 | Perseus Mining vs. Direct Line Insurance |
| Howden Joinery vs. Fortune Brands Home | Howden Joinery vs. Whirlpool | Howden Joinery vs. Tempur Sealy International | Howden Joinery vs. Leggett Platt Incorporated |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |