Correlation Between Perseus Mining and Easy Software
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Easy Software 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 Easy Software 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 Easy Software AG, you can compare the effects of market volatilities on Perseus Mining and Easy Software 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 Easy Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Easy Software.
Diversification Opportunities for Perseus Mining and Easy Software
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Perseus and Easy is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and Easy Software AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Easy Software AG 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 Easy Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Easy Software AG has no effect on the direction of Perseus Mining i.e., Perseus Mining and Easy Software go up and down completely randomly.
Pair Corralation between Perseus Mining and Easy Software
Assuming the 90 days horizon Perseus Mining is expected to generate 1.27 times less return on investment than Easy Software. But when comparing it to its historical volatility, Perseus Mining Limited is 1.21 times less risky than Easy Software. It trades about 0.1 of its potential returns per unit of risk. Easy Software AG is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,460 in Easy Software AG on December 12, 2024 and sell it today you would earn a total of 320.00 from holding Easy Software AG or generate 21.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perseus Mining Limited vs. Easy Software AG
Performance |
| Timeline |
| Perseus Mining |
| Easy Software AG |
Perseus Mining and Easy Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and Easy Software
The main advantage of trading using opposite Perseus Mining and Easy Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Easy Software 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 Easy Software will offset losses from the drop in Easy Software's long position.| Perseus Mining vs. ZIJIN MINH UNSPADR20 | ||
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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