Correlation Between Ramp Metals and Maple Leaf
Can any of the company-specific risk be diversified away by investing in both Ramp Metals and Maple Leaf 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 Ramp Metals and Maple Leaf into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ramp Metals and Maple Leaf Foods, you can compare the effects of market volatilities on Ramp Metals and Maple Leaf 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 Ramp Metals with a short position of Maple Leaf. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ramp Metals and Maple Leaf.
Diversification Opportunities for Ramp Metals and Maple Leaf
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ramp and Maple is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Ramp Metals and Maple Leaf Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maple Leaf Foods and Ramp Metals 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 Ramp Metals are associated (or correlated) with Maple Leaf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maple Leaf Foods has no effect on the direction of Ramp Metals i.e., Ramp Metals and Maple Leaf go up and down completely randomly.
Pair Corralation between Ramp Metals and Maple Leaf
Assuming the 90 days trading horizon Ramp Metals is expected to generate 27.08 times less return on investment than Maple Leaf. In addition to that, Ramp Metals is 2.03 times more volatile than Maple Leaf Foods. It trades about 0.0 of its total potential returns per unit of risk. Maple Leaf Foods is currently generating about 0.19 per unit of volatility. If you would invest 2,135 in Maple Leaf Foods on August 31, 2024 and sell it today you would earn a total of 178.00 from holding Maple Leaf Foods or generate 8.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ramp Metals vs. Maple Leaf Foods
Performance |
| Timeline |
| Ramp Metals |
| Maple Leaf Foods |
Ramp Metals and Maple Leaf Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ramp Metals and Maple Leaf
The main advantage of trading using opposite Ramp Metals and Maple Leaf positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ramp Metals position performs unexpectedly, Maple Leaf 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 Maple Leaf will offset losses from the drop in Maple Leaf's long position.| Ramp Metals vs. Ivanhoe Mines | Ramp Metals vs. Filo Mining Corp | Ramp Metals vs. Sigma Lithium Resources | Ramp Metals vs. Calibre Mining Corp |
| Maple Leaf vs. Saputo Inc | Maple Leaf vs. Forstrong Global Income | Maple Leaf vs. iShares Canadian HYBrid | Maple Leaf vs. Brompton European Dividend |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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