Correlation Between Postmedia Network and Millbank Mining
Can any of the company-specific risk be diversified away by investing in both Postmedia Network and Millbank Mining 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 Postmedia Network and Millbank Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Postmedia Network Canada and Millbank Mining Corp, you can compare the effects of market volatilities on Postmedia Network and Millbank Mining 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 Postmedia Network with a short position of Millbank Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Postmedia Network and Millbank Mining.
Diversification Opportunities for Postmedia Network and Millbank Mining
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Postmedia and Millbank is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Postmedia Network Canada and Millbank Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Millbank Mining Corp and Postmedia Network 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 Postmedia Network Canada are associated (or correlated) with Millbank Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Millbank Mining Corp has no effect on the direction of Postmedia Network i.e., Postmedia Network and Millbank Mining go up and down completely randomly.
Pair Corralation between Postmedia Network and Millbank Mining
Assuming the 90 days trading horizon Postmedia Network Canada is expected to generate 0.82 times more return on investment than Millbank Mining. However, Postmedia Network Canada is 1.21 times less risky than Millbank Mining. It trades about 0.0 of its potential returns per unit of risk. Millbank Mining Corp is currently generating about -0.1 per unit of risk. If you would invest 125.00 in Postmedia Network Canada on September 20, 2024 and sell it today you would lose (1.00) from holding Postmedia Network Canada or give up 0.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Postmedia Network Canada vs. Millbank Mining Corp
Performance |
| Timeline |
| Postmedia Network Canada |
| Millbank Mining Corp |
Postmedia Network and Millbank Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Postmedia Network and Millbank Mining
The main advantage of trading using opposite Postmedia Network and Millbank Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Postmedia Network position performs unexpectedly, Millbank Mining 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 Millbank Mining will offset losses from the drop in Millbank Mining's long position.| Postmedia Network vs. Genesis Land Development | Postmedia Network vs. Madison Pacific Properties | Postmedia Network vs. Goodfellow | Postmedia Network vs. Helix BioPharma Corp |
| Millbank Mining vs. Maple Peak Investments | Millbank Mining vs. Diversified Royalty Corp | Millbank Mining vs. Data Communications Management | Millbank Mining vs. Postmedia Network Canada |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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