Correlation Between Thor Mining and Intuitive Investments
Can any of the company-specific risk be diversified away by investing in both Thor Mining and Intuitive Investments 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 Intuitive Investments 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 Intuitive Investments Group, you can compare the effects of market volatilities on Thor Mining and Intuitive Investments 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 Intuitive Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thor Mining and Intuitive Investments.
Diversification Opportunities for Thor Mining and Intuitive Investments
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Thor and Intuitive is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Thor Mining PLC and Intuitive Investments Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Investments 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 Intuitive Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intuitive Investments has no effect on the direction of Thor Mining i.e., Thor Mining and Intuitive Investments go up and down completely randomly.
Pair Corralation between Thor Mining and Intuitive Investments
Assuming the 90 days trading horizon Thor Mining PLC is expected to under-perform the Intuitive Investments. But the stock apears to be less risky and, when comparing its historical volatility, Thor Mining PLC is 1.21 times less risky than Intuitive Investments. The stock trades about -0.05 of its potential returns per unit of risk. The Intuitive Investments Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 6,250 in Intuitive Investments Group on September 2, 2024 and sell it today you would earn a total of 6,050 from holding Intuitive Investments Group or generate 96.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thor Mining PLC vs. Intuitive Investments Group
Performance |
| Timeline |
| Thor Mining PLC |
| Intuitive Investments |
Thor Mining and Intuitive Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thor Mining and Intuitive Investments
The main advantage of trading using opposite Thor Mining and Intuitive Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thor Mining position performs unexpectedly, Intuitive Investments 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 Intuitive Investments will offset losses from the drop in Intuitive Investments' long position.| Thor Mining vs. Givaudan SA | Thor Mining vs. Antofagasta PLC | Thor Mining vs. Centamin PLC | Thor Mining vs. Atalaya Mining |
| Intuitive Investments vs. Toyota Motor Corp | Intuitive Investments vs. SoftBank Group Corp | Intuitive Investments vs. OTP Bank Nyrt | Intuitive Investments vs. Las Vegas Sands |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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