Correlation Between Perseus Mining and Markel
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Markel 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 Markel 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 Markel, you can compare the effects of market volatilities on Perseus Mining and Markel 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 Markel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Markel.
Diversification Opportunities for Perseus Mining and Markel
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Perseus and Markel is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and Markel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Markel 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 Markel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Markel has no effect on the direction of Perseus Mining i.e., Perseus Mining and Markel go up and down completely randomly.
Pair Corralation between Perseus Mining and Markel
Assuming the 90 days horizon Perseus Mining is expected to generate 4.95 times less return on investment than Markel. In addition to that, Perseus Mining is 1.29 times more volatile than Markel. It trades about 0.04 of its total potential returns per unit of risk. Markel is currently generating about 0.25 per unit of volatility. If you would invest 141,400 in Markel on September 4, 2024 and sell it today you would earn a total of 26,100 from holding Markel or generate 18.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.67% |
| Values | Daily Returns |
Perseus Mining Limited vs. Markel
Performance |
| Timeline |
| Perseus Mining |
| Markel |
Perseus Mining and Markel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and Markel
The main advantage of trading using opposite Perseus Mining and Markel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Markel 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 Markel will offset losses from the drop in Markel's long position.| Perseus Mining vs. ZIJIN MINH UNSPADR20 | Perseus Mining vs. Barrick Gold | Perseus Mining vs. Superior Plus Corp | Perseus Mining vs. NMI Holdings |
| Markel vs. Chuangs China Investments | Markel vs. Xinhua Winshare Publishing | Markel vs. EEDUCATION ALBERT AB | Markel vs. CapitaLand Investment 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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