Correlation Between Thor Mining and Ashtead Technology
Can any of the company-specific risk be diversified away by investing in both Thor Mining and Ashtead Technology 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 Ashtead Technology 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 Ashtead Technology Holdings, you can compare the effects of market volatilities on Thor Mining and Ashtead Technology 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 Ashtead Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thor Mining and Ashtead Technology.
Diversification Opportunities for Thor Mining and Ashtead Technology
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Thor and Ashtead is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Thor Mining PLC and Ashtead Technology Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashtead Technology 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 Ashtead Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashtead Technology has no effect on the direction of Thor Mining i.e., Thor Mining and Ashtead Technology go up and down completely randomly.
Pair Corralation between Thor Mining and Ashtead Technology
Assuming the 90 days trading horizon Thor Mining PLC is expected to under-perform the Ashtead Technology. In addition to that, Thor Mining is 2.0 times more volatile than Ashtead Technology Holdings. It trades about -0.17 of its total potential returns per unit of risk. Ashtead Technology Holdings is currently generating about 0.0 per unit of volatility. If you would invest 55,200 in Ashtead Technology Holdings on September 1, 2024 and sell it today you would lose (100.00) from holding Ashtead Technology Holdings or give up 0.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thor Mining PLC vs. Ashtead Technology Holdings
Performance |
| Timeline |
| Thor Mining PLC |
| Ashtead Technology |
Thor Mining and Ashtead Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thor Mining and Ashtead Technology
The main advantage of trading using opposite Thor Mining and Ashtead Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thor Mining position performs unexpectedly, Ashtead Technology 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 Ashtead Technology will offset losses from the drop in Ashtead Technology's long position.| Thor Mining vs. Givaudan SA | Thor Mining vs. Antofagasta PLC | Thor Mining vs. Centamin PLC | Thor Mining vs. Atalaya Mining |
| Ashtead Technology vs. Orient Telecoms | Ashtead Technology vs. Auction Technology Group | Ashtead Technology vs. Sabien Technology Group | Ashtead Technology vs. DXC Technology Co |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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