Correlation Between Picton Mahoney and First Asset
Can any of the company-specific risk be diversified away by investing in both Picton Mahoney and First Asset 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 Picton Mahoney and First Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Picton Mahoney Fortified and First Asset Energy, you can compare the effects of market volatilities on Picton Mahoney and First Asset 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 Picton Mahoney with a short position of First Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Picton Mahoney and First Asset.
Diversification Opportunities for Picton Mahoney and First Asset
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Picton and First is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Picton Mahoney Fortified and First Asset Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Asset Energy and Picton Mahoney 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 Picton Mahoney Fortified are associated (or correlated) with First Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Asset Energy has no effect on the direction of Picton Mahoney i.e., Picton Mahoney and First Asset go up and down completely randomly.
Pair Corralation between Picton Mahoney and First Asset
Assuming the 90 days trading horizon Picton Mahoney Fortified is expected to generate 0.25 times more return on investment than First Asset. However, Picton Mahoney Fortified is 3.94 times less risky than First Asset. It trades about 0.09 of its potential returns per unit of risk. First Asset Energy is currently generating about 0.02 per unit of risk. If you would invest 877.00 in Picton Mahoney Fortified on September 4, 2024 and sell it today you would earn a total of 123.00 from holding Picton Mahoney Fortified or generate 14.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Picton Mahoney Fortified vs. First Asset Energy
Performance |
| Timeline |
| Picton Mahoney Fortified |
| First Asset Energy |
Picton Mahoney and First Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Picton Mahoney and First Asset
The main advantage of trading using opposite Picton Mahoney and First Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Picton Mahoney position performs unexpectedly, First Asset 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 First Asset will offset losses from the drop in First Asset's long position.| Picton Mahoney vs. PIMCO Monthly Income | Picton Mahoney vs. Picton Mahoney Fortified | Picton Mahoney vs. Mackenzie Unconstrained Bond | Picton Mahoney vs. NBI Liquid Alternatives |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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