Correlation Between Peel Mining and Platinum Asia
Can any of the company-specific risk be diversified away by investing in both Peel Mining and Platinum Asia 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 Peel Mining and Platinum Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peel Mining and Platinum Asia Investments, you can compare the effects of market volatilities on Peel Mining and Platinum Asia 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 Peel Mining with a short position of Platinum Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peel Mining and Platinum Asia.
Diversification Opportunities for Peel Mining and Platinum Asia
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Peel and Platinum is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Peel Mining and Platinum Asia Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Platinum Asia Investments and Peel 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 Peel Mining are associated (or correlated) with Platinum Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Platinum Asia Investments has no effect on the direction of Peel Mining i.e., Peel Mining and Platinum Asia go up and down completely randomly.
Pair Corralation between Peel Mining and Platinum Asia
Assuming the 90 days trading horizon Peel Mining is expected to generate 1.01 times less return on investment than Platinum Asia. In addition to that, Peel Mining is 3.98 times more volatile than Platinum Asia Investments. It trades about 0.01 of its total potential returns per unit of risk. Platinum Asia Investments is currently generating about 0.05 per unit of volatility. If you would invest 84.00 in Platinum Asia Investments on November 27, 2024 and sell it today you would earn a total of 24.00 from holding Platinum Asia Investments or generate 28.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peel Mining vs. Platinum Asia Investments
Performance |
| Timeline |
| Peel Mining |
| Platinum Asia Investments |
Peel Mining and Platinum Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peel Mining and Platinum Asia
The main advantage of trading using opposite Peel Mining and Platinum Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peel Mining position performs unexpectedly, Platinum Asia 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 Platinum Asia will offset losses from the drop in Platinum Asia's long position.| Peel Mining vs. Catalyst Metals | Peel Mining vs. Evolution Mining | Peel Mining vs. Group 6 Metals | Peel Mining vs. Perseus Mining |
| Platinum Asia vs. Super Retail Group | Platinum Asia vs. Genetic Technologies | Platinum Asia vs. Dug Technology | Platinum Asia vs. Neurotech International |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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