Correlation Between Perseus Mining and Caseys General
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Caseys General 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 Caseys General 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 Caseys General Stores, you can compare the effects of market volatilities on Perseus Mining and Caseys General 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 Caseys General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Caseys General.
Diversification Opportunities for Perseus Mining and Caseys General
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Perseus and Caseys is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and Caseys General Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caseys General Stores 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 Caseys General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caseys General Stores has no effect on the direction of Perseus Mining i.e., Perseus Mining and Caseys General go up and down completely randomly.
Pair Corralation between Perseus Mining and Caseys General
Assuming the 90 days horizon Perseus Mining Limited is expected to under-perform the Caseys General. In addition to that, Perseus Mining is 1.07 times more volatile than Caseys General Stores. It trades about -0.11 of its total potential returns per unit of risk. Caseys General Stores is currently generating about 0.21 per unit of volatility. If you would invest 36,150 in Caseys General Stores on September 1, 2024 and sell it today you would earn a total of 3,450 from holding Caseys General Stores or generate 9.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perseus Mining Limited vs. Caseys General Stores
Performance |
| Timeline |
| Perseus Mining |
| Caseys General Stores |
Perseus Mining and Caseys General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and Caseys General
The main advantage of trading using opposite Perseus Mining and Caseys General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Caseys General 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 Caseys General will offset losses from the drop in Caseys General'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 |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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