Correlation Between Power Metal and SupplyMe Capital
Can any of the company-specific risk be diversified away by investing in both Power Metal and SupplyMe Capital 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 Power Metal and SupplyMe Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Power Metal Resources and SupplyMe Capital PLC, you can compare the effects of market volatilities on Power Metal and SupplyMe Capital 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 Power Metal with a short position of SupplyMe Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Power Metal and SupplyMe Capital.
Diversification Opportunities for Power Metal and SupplyMe Capital
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Power and SupplyMe is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Power Metal Resources and SupplyMe Capital PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SupplyMe Capital PLC and Power Metal 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 Power Metal Resources are associated (or correlated) with SupplyMe Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SupplyMe Capital PLC has no effect on the direction of Power Metal i.e., Power Metal and SupplyMe Capital go up and down completely randomly.
Pair Corralation between Power Metal and SupplyMe Capital
Assuming the 90 days trading horizon Power Metal Resources is expected to generate 0.47 times more return on investment than SupplyMe Capital. However, Power Metal Resources is 2.14 times less risky than SupplyMe Capital. It trades about -0.01 of its potential returns per unit of risk. SupplyMe Capital PLC is currently generating about -0.02 per unit of risk. If you would invest 2,500 in Power Metal Resources on October 28, 2024 and sell it today you would lose (1,150) from holding Power Metal Resources or give up 46.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Power Metal Resources vs. SupplyMe Capital PLC
Performance |
| Timeline |
| Power Metal Resources |
| SupplyMe Capital PLC |
Power Metal and SupplyMe Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Power Metal and SupplyMe Capital
The main advantage of trading using opposite Power Metal and SupplyMe Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Power Metal position performs unexpectedly, SupplyMe Capital 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 SupplyMe Capital will offset losses from the drop in SupplyMe Capital's long position.| Power Metal vs. Givaudan SA | Power Metal vs. Antofagasta PLC | Power Metal vs. Ferrexpo PLC | Power Metal vs. Atalaya Mining |
| SupplyMe Capital vs. Sparebank 1 SR | SupplyMe Capital vs. St Galler Kantonalbank | SupplyMe Capital vs. Spirent Communications plc | SupplyMe Capital vs. TBC Bank Group |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |