Correlation Between Perseus Mining and Church Dwight
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Church Dwight 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 Church Dwight 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 Church Dwight, you can compare the effects of market volatilities on Perseus Mining and Church Dwight 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 Church Dwight. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Church Dwight.
Diversification Opportunities for Perseus Mining and Church Dwight
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Perseus and Church is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and Church Dwight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Church Dwight 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 Church Dwight. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Church Dwight has no effect on the direction of Perseus Mining i.e., Perseus Mining and Church Dwight go up and down completely randomly.
Pair Corralation between Perseus Mining and Church Dwight
Assuming the 90 days horizon Perseus Mining Limited is expected to generate 2.79 times more return on investment than Church Dwight. However, Perseus Mining is 2.79 times more volatile than Church Dwight. It trades about 0.05 of its potential returns per unit of risk. Church Dwight is currently generating about 0.05 per unit of risk. If you would invest 120.00 in Perseus Mining Limited on September 2, 2024 and sell it today you would earn a total of 48.00 from holding Perseus Mining Limited or generate 40.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.51% |
| Values | Daily Returns |
Perseus Mining Limited vs. Church Dwight
Performance |
| Timeline |
| Perseus Mining |
| Church Dwight |
Perseus Mining and Church Dwight Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and Church Dwight
The main advantage of trading using opposite Perseus Mining and Church Dwight positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Church Dwight 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 Church Dwight will offset losses from the drop in Church Dwight's long position.| Perseus Mining vs. Aurion Resources | Perseus Mining vs. Rio2 Limited | Perseus Mining vs. Palamina Corp | Perseus Mining vs. BTU Metals Corp |
| Church Dwight vs. Colgate Palmolive | Church Dwight vs. Unilever PLC ADR | Church Dwight vs. Kimberly Clark | Church Dwight vs. Estee Lauder Companies |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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