Correlation Between SCOR PK and Atico Mining
Can any of the company-specific risk be diversified away by investing in both SCOR PK and Atico 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 SCOR PK and Atico Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCOR PK and Atico Mining, you can compare the effects of market volatilities on SCOR PK and Atico 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 SCOR PK with a short position of Atico Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCOR PK and Atico Mining.
Diversification Opportunities for SCOR PK and Atico Mining
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SCOR and Atico is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding SCOR PK and Atico Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atico Mining and SCOR PK 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 SCOR PK are associated (or correlated) with Atico Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atico Mining has no effect on the direction of SCOR PK i.e., SCOR PK and Atico Mining go up and down completely randomly.
Pair Corralation between SCOR PK and Atico Mining
Assuming the 90 days horizon SCOR PK is expected to generate 1.04 times less return on investment than Atico Mining. But when comparing it to its historical volatility, SCOR PK is 2.08 times less risky than Atico Mining. It trades about 0.02 of its potential returns per unit of risk. Atico Mining is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 17.00 in Atico Mining on August 31, 2024 and sell it today you would lose (7.00) from holding Atico Mining or give up 41.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.37% |
| Values | Daily Returns |
SCOR PK vs. Atico Mining
Performance |
| Timeline |
| SCOR PK |
| Atico Mining |
SCOR PK and Atico Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCOR PK and Atico Mining
The main advantage of trading using opposite SCOR PK and Atico Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCOR PK position performs unexpectedly, Atico 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 Atico Mining will offset losses from the drop in Atico Mining's long position.The idea behind SCOR PK and Atico Mining pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Atico Mining vs. South32 Limited | Atico Mining vs. NioCorp Developments Ltd | Atico Mining vs. HUMANA INC | Atico Mining vs. SCOR PK |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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