Correlation Between Perseus Mining and Thyssenkrupp
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Thyssenkrupp 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 Thyssenkrupp 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 thyssenkrupp AG, you can compare the effects of market volatilities on Perseus Mining and Thyssenkrupp 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 Thyssenkrupp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Thyssenkrupp.
Diversification Opportunities for Perseus Mining and Thyssenkrupp
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Perseus and Thyssenkrupp is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and thyssenkrupp AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on thyssenkrupp 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 Thyssenkrupp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of thyssenkrupp AG has no effect on the direction of Perseus Mining i.e., Perseus Mining and Thyssenkrupp go up and down completely randomly.
Pair Corralation between Perseus Mining and Thyssenkrupp
Assuming the 90 days horizon Perseus Mining Limited is expected to under-perform the Thyssenkrupp. But the stock apears to be less risky and, when comparing its historical volatility, Perseus Mining Limited is 1.71 times less risky than Thyssenkrupp. The stock trades about 0.0 of its potential returns per unit of risk. The thyssenkrupp AG is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 348.00 in thyssenkrupp AG on August 29, 2024 and sell it today you would earn a total of 29.00 from holding thyssenkrupp AG or generate 8.33% 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. thyssenkrupp AG
Performance |
| Timeline |
| Perseus Mining |
| thyssenkrupp AG |
Perseus Mining and Thyssenkrupp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and Thyssenkrupp
The main advantage of trading using opposite Perseus Mining and Thyssenkrupp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Thyssenkrupp 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 Thyssenkrupp will offset losses from the drop in Thyssenkrupp's long position.| Perseus Mining vs. Corporate Travel Management | Perseus Mining vs. ADRIATIC METALS LS 013355 | Perseus Mining vs. SCIENCE IN SPORT | Perseus Mining vs. NTG Nordic Transport |
| Thyssenkrupp vs. Zijin Mining Group | Thyssenkrupp vs. LION ONE METALS | Thyssenkrupp vs. Strategic Education | Thyssenkrupp 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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