Correlation Between Thor Mining and Universal Display
Can any of the company-specific risk be diversified away by investing in both Thor Mining and Universal Display 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 Thor Mining and Universal Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thor Mining PLC and Universal Display Corp, you can compare the effects of market volatilities on Thor Mining and Universal Display 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 Thor Mining with a short position of Universal Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thor Mining and Universal Display.
Diversification Opportunities for Thor Mining and Universal Display
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Thor and Universal is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Thor Mining PLC and Universal Display Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Display Corp and Thor 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 Thor Mining PLC are associated (or correlated) with Universal Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Display Corp has no effect on the direction of Thor Mining i.e., Thor Mining and Universal Display go up and down completely randomly.
Pair Corralation between Thor Mining and Universal Display
Assuming the 90 days trading horizon Thor Mining PLC is expected to under-perform the Universal Display. In addition to that, Thor Mining is 1.61 times more volatile than Universal Display Corp. It trades about -0.04 of its total potential returns per unit of risk. Universal Display Corp is currently generating about 0.04 per unit of volatility. If you would invest 11,620 in Universal Display Corp on August 24, 2024 and sell it today you would earn a total of 4,890 from holding Universal Display Corp or generate 42.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 81.53% |
| Values | Daily Returns |
Thor Mining PLC vs. Universal Display Corp
Performance |
| Timeline |
| Thor Mining PLC |
| Universal Display Corp |
Thor Mining and Universal Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thor Mining and Universal Display
The main advantage of trading using opposite Thor Mining and Universal Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thor Mining position performs unexpectedly, Universal Display 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 Universal Display will offset losses from the drop in Universal Display's long position.| Thor Mining vs. United Internet AG | Thor Mining vs. Aeorema Communications Plc | Thor Mining vs. Cornish Metals | Thor Mining vs. Coeur Mining |
| Universal Display vs. Quadrise Plc | Universal Display vs. Intuitive Investments Group | Universal Display vs. European Metals Holdings | Universal Display vs. Athelney Trust plc |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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