Correlation Between Perseus Mining and Critical Metals
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Critical 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 Perseus Mining and Critical Metals 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 Critical Metals Corp, you can compare the effects of market volatilities on Perseus Mining and Critical 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 Perseus Mining with a short position of Critical Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Critical Metals.
Diversification Opportunities for Perseus Mining and Critical Metals
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Perseus and Critical is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and Critical Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Critical Metals Corp 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 Critical Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Critical Metals Corp has no effect on the direction of Perseus Mining i.e., Perseus Mining and Critical Metals go up and down completely randomly.
Pair Corralation between Perseus Mining and Critical Metals
Assuming the 90 days horizon Perseus Mining Limited is expected to generate 0.21 times more return on investment than Critical Metals. However, Perseus Mining Limited is 4.84 times less risky than Critical Metals. It trades about 0.09 of its potential returns per unit of risk. Critical Metals Corp is currently generating about -0.5 per unit of risk. If you would invest 179.00 in Perseus Mining Limited on December 4, 2024 and sell it today you would earn a total of 8.00 from holding Perseus Mining Limited or generate 4.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perseus Mining Limited vs. Critical Metals Corp
Performance |
| Timeline |
| Perseus Mining |
| Critical Metals Corp |
Perseus Mining and Critical Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and Critical Metals
The main advantage of trading using opposite Perseus Mining and Critical Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Critical 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 Critical Metals will offset losses from the drop in Critical Metals' long position.| Perseus Mining vs. Aurion Resources | Perseus Mining vs. Liberty Gold Corp | Perseus Mining vs. Rio2 Limited | Perseus Mining vs. Orezone Gold Corp |
| Critical Metals vs. Pintec Technology Holdings | Critical Metals vs. KeyCorp | Critical Metals vs. Merit Medical Systems | Critical Metals vs. Genfit |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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