Correlation Between Perseus Mining and ATCO
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and ATCO 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 ATCO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Perseus Mining and ATCO, you can compare the effects of market volatilities on Perseus Mining and ATCO 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 ATCO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and ATCO.
Diversification Opportunities for Perseus Mining and ATCO
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Perseus and ATCO is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining and ATCO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATCO 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 are associated (or correlated) with ATCO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATCO has no effect on the direction of Perseus Mining i.e., Perseus Mining and ATCO go up and down completely randomly.
Pair Corralation between Perseus Mining and ATCO
Assuming the 90 days trading horizon Perseus Mining is expected to generate 1.35 times more return on investment than ATCO. However, Perseus Mining is 1.35 times more volatile than ATCO. It trades about 0.05 of its potential returns per unit of risk. ATCO is currently generating about 0.07 per unit of risk. If you would invest 220.00 in Perseus Mining on September 5, 2024 and sell it today you would earn a total of 15.00 from holding Perseus Mining or generate 6.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perseus Mining vs. ATCO
Performance |
| Timeline |
| Perseus Mining |
| ATCO |
Perseus Mining and ATCO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and ATCO
The main advantage of trading using opposite Perseus Mining and ATCO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, ATCO 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 ATCO will offset losses from the drop in ATCO's long position.| Perseus Mining vs. Serabi Gold PLC | Perseus Mining vs. Sulliden Minerals SA | Perseus Mining vs. Precipitate Gold Corp | Perseus Mining vs. Rackla Metals |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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