Correlation Between Pinetree Capital and Laramide Resources
Can any of the company-specific risk be diversified away by investing in both Pinetree Capital and Laramide Resources 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 Pinetree Capital and Laramide Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pinetree Capital and Laramide Resources, you can compare the effects of market volatilities on Pinetree Capital and Laramide Resources 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 Pinetree Capital with a short position of Laramide Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pinetree Capital and Laramide Resources.
Diversification Opportunities for Pinetree Capital and Laramide Resources
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pinetree and Laramide is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Pinetree Capital and Laramide Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Laramide Resources and Pinetree Capital 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 Pinetree Capital are associated (or correlated) with Laramide Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Laramide Resources has no effect on the direction of Pinetree Capital i.e., Pinetree Capital and Laramide Resources go up and down completely randomly.
Pair Corralation between Pinetree Capital and Laramide Resources
Assuming the 90 days trading horizon Pinetree Capital is expected to generate 0.64 times more return on investment than Laramide Resources. However, Pinetree Capital is 1.55 times less risky than Laramide Resources. It trades about 0.17 of its potential returns per unit of risk. Laramide Resources is currently generating about 0.03 per unit of risk. If you would invest 399.00 in Pinetree Capital on September 2, 2024 and sell it today you would earn a total of 851.00 from holding Pinetree Capital or generate 213.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pinetree Capital vs. Laramide Resources
Performance |
| Timeline |
| Pinetree Capital |
| Laramide Resources |
Pinetree Capital and Laramide Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pinetree Capital and Laramide Resources
The main advantage of trading using opposite Pinetree Capital and Laramide Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pinetree Capital position performs unexpectedly, Laramide Resources 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 Laramide Resources will offset losses from the drop in Laramide Resources' long position.| Pinetree Capital vs. Laramide Resources | Pinetree Capital vs. Mega Uranium | Pinetree Capital vs. Aston Bay Holdings | Pinetree Capital vs. Ur Energy |
| Laramide Resources vs. Mega Uranium | Laramide Resources vs. Forsys Metals Corp | Laramide Resources vs. Pinetree Capital | Laramide Resources vs. Ur Energy |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |