Correlation Between Search Minerals and CDN Maverick
Can any of the company-specific risk be diversified away by investing in both Search Minerals and CDN Maverick 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 Search Minerals and CDN Maverick into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Search Minerals and CDN Maverick Capital, you can compare the effects of market volatilities on Search Minerals and CDN Maverick 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 Search Minerals with a short position of CDN Maverick. Check out your portfolio center. Please also check ongoing floating volatility patterns of Search Minerals and CDN Maverick.
Diversification Opportunities for Search Minerals and CDN Maverick
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Search and CDN is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Search Minerals and CDN Maverick Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDN Maverick Capital and Search Minerals 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 Search Minerals are associated (or correlated) with CDN Maverick. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDN Maverick Capital has no effect on the direction of Search Minerals i.e., Search Minerals and CDN Maverick go up and down completely randomly.
Pair Corralation between Search Minerals and CDN Maverick
Assuming the 90 days horizon Search Minerals is expected to generate 8.19 times more return on investment than CDN Maverick. However, Search Minerals is 8.19 times more volatile than CDN Maverick Capital. It trades about 0.08 of its potential returns per unit of risk. CDN Maverick Capital is currently generating about 0.03 per unit of risk. If you would invest 2.40 in Search Minerals on August 29, 2024 and sell it today you would lose (1.20) from holding Search Minerals or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Search Minerals vs. CDN Maverick Capital
Performance |
| Timeline |
| Search Minerals |
| CDN Maverick Capital |
Search Minerals and CDN Maverick Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Search Minerals and CDN Maverick
The main advantage of trading using opposite Search Minerals and CDN Maverick positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Search Minerals position performs unexpectedly, CDN Maverick 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 CDN Maverick will offset losses from the drop in CDN Maverick's long position.| Search Minerals vs. Silver Hammer Mining | Search Minerals vs. Reyna Silver Corp | Search Minerals vs. Guanajuato Silver | Search Minerals vs. Silver One Resources |
| CDN Maverick vs. Aurelia Metals Limited | CDN Maverick vs. Artemis Resources | CDN Maverick vs. Ascendant Resources | CDN Maverick vs. Azimut Exploration |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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