Correlation Between Perseus Mining and Tenaris SA
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Tenaris SA 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 Tenaris SA 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 Tenaris SA ADR, you can compare the effects of market volatilities on Perseus Mining and Tenaris SA 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 Tenaris SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Tenaris SA.
Diversification Opportunities for Perseus Mining and Tenaris SA
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Perseus and Tenaris is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and Tenaris SA ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tenaris SA ADR 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 Tenaris SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tenaris SA ADR has no effect on the direction of Perseus Mining i.e., Perseus Mining and Tenaris SA go up and down completely randomly.
Pair Corralation between Perseus Mining and Tenaris SA
Assuming the 90 days horizon Perseus Mining is expected to generate 6.22 times less return on investment than Tenaris SA. In addition to that, Perseus Mining is 1.71 times more volatile than Tenaris SA ADR. It trades about 0.03 of its total potential returns per unit of risk. Tenaris SA ADR is currently generating about 0.32 per unit of volatility. If you would invest 2,792 in Tenaris SA ADR on September 12, 2024 and sell it today you would earn a total of 1,116 from holding Tenaris SA ADR or generate 39.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Perseus Mining Limited vs. Tenaris SA ADR
Performance |
| Timeline |
| Perseus Mining |
| Tenaris SA ADR |
Perseus Mining and Tenaris SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and Tenaris SA
The main advantage of trading using opposite Perseus Mining and Tenaris SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Tenaris SA 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 Tenaris SA will offset losses from the drop in Tenaris SA's long position.| Perseus Mining vs. Revival Gold | Perseus Mining vs. Galiano Gold | Perseus Mining vs. US Gold Corp | Perseus Mining vs. HUMANA INC |
| Tenaris SA vs. TechnipFMC PLC | Tenaris SA vs. Now Inc | Tenaris SA vs. ChampionX | Tenaris SA vs. Baker Hughes Co |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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