Correlation Between Sego Resources and Finlay Minerals
Can any of the company-specific risk be diversified away by investing in both Sego Resources and Finlay Minerals 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 Sego Resources and Finlay Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sego Resources and Finlay Minerals, you can compare the effects of market volatilities on Sego Resources and Finlay Minerals 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 Sego Resources with a short position of Finlay Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sego Resources and Finlay Minerals.
Diversification Opportunities for Sego Resources and Finlay Minerals
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sego and Finlay is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Sego Resources and Finlay Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finlay Minerals and Sego Resources 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 Sego Resources are associated (or correlated) with Finlay Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finlay Minerals has no effect on the direction of Sego Resources i.e., Sego Resources and Finlay Minerals go up and down completely randomly.
Pair Corralation between Sego Resources and Finlay Minerals
Assuming the 90 days horizon Sego Resources is expected to generate 1.16 times more return on investment than Finlay Minerals. However, Sego Resources is 1.16 times more volatile than Finlay Minerals. It trades about 0.06 of its potential returns per unit of risk. Finlay Minerals is currently generating about -0.09 per unit of risk. If you would invest 2.00 in Sego Resources on September 13, 2024 and sell it today you would earn a total of 0.00 from holding Sego Resources or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sego Resources vs. Finlay Minerals
Performance |
| Timeline |
| Sego Resources |
| Finlay Minerals |
Sego Resources and Finlay Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sego Resources and Finlay Minerals
The main advantage of trading using opposite Sego Resources and Finlay Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sego Resources position performs unexpectedly, Finlay Minerals 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 Finlay Minerals will offset losses from the drop in Finlay Minerals' long position.| Sego Resources vs. Constellation Software | Sego Resources vs. Evertz Technologies Limited | Sego Resources vs. Birchtech Corp | Sego Resources vs. Ocumetics Technology Corp |
| Finlay Minerals vs. CMC Metals | Finlay Minerals vs. Tarku Resources | Finlay Minerals vs. Highway 50 Gold |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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