Correlation Between Perseus Mining and Chesapeake Utilities
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Chesapeake Utilities 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 Chesapeake Utilities 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 Chesapeake Utilities, you can compare the effects of market volatilities on Perseus Mining and Chesapeake Utilities 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 Chesapeake Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Chesapeake Utilities.
Diversification Opportunities for Perseus Mining and Chesapeake Utilities
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Perseus and Chesapeake is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and Chesapeake Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chesapeake Utilities 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 Chesapeake Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chesapeake Utilities has no effect on the direction of Perseus Mining i.e., Perseus Mining and Chesapeake Utilities go up and down completely randomly.
Pair Corralation between Perseus Mining and Chesapeake Utilities
Assuming the 90 days horizon Perseus Mining Limited is expected to generate 2.11 times more return on investment than Chesapeake Utilities. However, Perseus Mining is 2.11 times more volatile than Chesapeake Utilities. It trades about 0.18 of its potential returns per unit of risk. Chesapeake Utilities is currently generating about 0.01 per unit of risk. If you would invest 150.00 in Perseus Mining Limited on September 15, 2024 and sell it today you would earn a total of 14.00 from holding Perseus Mining Limited or generate 9.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perseus Mining Limited vs. Chesapeake Utilities
Performance |
| Timeline |
| Perseus Mining |
| Chesapeake Utilities |
Perseus Mining and Chesapeake Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and Chesapeake Utilities
The main advantage of trading using opposite Perseus Mining and Chesapeake Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Chesapeake Utilities 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 Chesapeake Utilities will offset losses from the drop in Chesapeake Utilities' long position.| Perseus Mining vs. United Insurance Holdings | Perseus Mining vs. Strategic Education | Perseus Mining vs. UNITED RENTALS | Perseus Mining vs. Zurich Insurance Group |
| Chesapeake Utilities vs. Thai Beverage Public | Chesapeake Utilities vs. Monster Beverage Corp | Chesapeake Utilities vs. Suntory Beverage Food | Chesapeake Utilities vs. Perseus Mining Limited |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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