Correlation Between Platinum Group and Brixton Metals
Can any of the company-specific risk be diversified away by investing in both Platinum Group and Brixton Metals 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 Platinum Group and Brixton Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Platinum Group Metals and Brixton Metals, you can compare the effects of market volatilities on Platinum Group and Brixton Metals 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 Platinum Group with a short position of Brixton Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Platinum Group and Brixton Metals.
Diversification Opportunities for Platinum Group and Brixton Metals
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Platinum and Brixton is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Platinum Group Metals and Brixton Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brixton Metals and Platinum Group 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 Platinum Group Metals are associated (or correlated) with Brixton Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brixton Metals has no effect on the direction of Platinum Group i.e., Platinum Group and Brixton Metals go up and down completely randomly.
Pair Corralation between Platinum Group and Brixton Metals
Considering the 90-day investment horizon Platinum Group Metals is not expected to generate positive returns. Moreover, Platinum Group is 1.4 times more volatile than Brixton Metals. It trades away all of its potential returns to assume current level of volatility. Brixton Metals is currently generating about -0.32 per unit of risk. If you would invest 177.00 in Platinum Group Metals on September 2, 2024 and sell it today you would lose (4.00) from holding Platinum Group Metals or give up 2.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Platinum Group Metals vs. Brixton Metals
Performance |
| Timeline |
| Platinum Group Metals |
| Brixton Metals |
Platinum Group and Brixton Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Platinum Group and Brixton Metals
The main advantage of trading using opposite Platinum Group and Brixton Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Platinum Group position performs unexpectedly, Brixton Metals 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 Brixton Metals will offset losses from the drop in Brixton Metals' long position.| Platinum Group vs. Endeavour Silver Corp | Platinum Group vs. Avino Silver Gold | Platinum Group vs. Fortuna Silver Mines | Platinum Group vs. Impala Platinum Holdings |
| Brixton Metals vs. Defiance Silver Corp | Brixton Metals vs. HUMANA INC | Brixton Metals vs. SCOR PK | Brixton Metals vs. Aquagold 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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