Correlation Between Perseus Mining and BRIT AMER
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and BRIT AMER 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 BRIT AMER 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 BRIT AMER TOBACCO, you can compare the effects of market volatilities on Perseus Mining and BRIT AMER 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 BRIT AMER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and BRIT AMER.
Diversification Opportunities for Perseus Mining and BRIT AMER
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Perseus and BRIT is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and BRIT AMER TOBACCO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRIT AMER TOBACCO 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 BRIT AMER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRIT AMER TOBACCO has no effect on the direction of Perseus Mining i.e., Perseus Mining and BRIT AMER go up and down completely randomly.
Pair Corralation between Perseus Mining and BRIT AMER
Assuming the 90 days horizon Perseus Mining Limited is expected to generate 2.18 times more return on investment than BRIT AMER. However, Perseus Mining is 2.18 times more volatile than BRIT AMER TOBACCO. It trades about 0.08 of its potential returns per unit of risk. BRIT AMER TOBACCO is currently generating about 0.09 per unit of risk. If you would invest 100.00 in Perseus Mining Limited on September 1, 2024 and sell it today you would earn a total of 61.00 from holding Perseus Mining Limited or generate 61.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perseus Mining Limited vs. BRIT AMER TOBACCO
Performance |
| Timeline |
| Perseus Mining |
| BRIT AMER TOBACCO |
Perseus Mining and BRIT AMER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and BRIT AMER
The main advantage of trading using opposite Perseus Mining and BRIT AMER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, BRIT AMER 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 BRIT AMER will offset losses from the drop in BRIT AMER's long position.| Perseus Mining vs. COSMOSTEEL HLDGS | Perseus Mining vs. NIPPON STEEL SPADR | Perseus Mining vs. Tianjin Capital Environmental | Perseus Mining vs. CECO ENVIRONMENTAL |
| BRIT AMER vs. Enter Air SA | BRIT AMER vs. International Consolidated Airlines | BRIT AMER vs. FORWARD AIR P | BRIT AMER vs. Norwegian Air Shuttle |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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