Correlation Between THRACE PLASTICS and Eskay Mining
Can any of the company-specific risk be diversified away by investing in both THRACE PLASTICS and Eskay Mining 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 THRACE PLASTICS and Eskay Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THRACE PLASTICS and Eskay Mining Corp, you can compare the effects of market volatilities on THRACE PLASTICS and Eskay Mining 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 THRACE PLASTICS with a short position of Eskay Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of THRACE PLASTICS and Eskay Mining.
Diversification Opportunities for THRACE PLASTICS and Eskay Mining
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between THRACE and Eskay is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding THRACE PLASTICS and Eskay Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eskay Mining Corp and THRACE PLASTICS 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 THRACE PLASTICS are associated (or correlated) with Eskay Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eskay Mining Corp has no effect on the direction of THRACE PLASTICS i.e., THRACE PLASTICS and Eskay Mining go up and down completely randomly.
Pair Corralation between THRACE PLASTICS and Eskay Mining
Assuming the 90 days trading horizon THRACE PLASTICS is expected to generate 0.26 times more return on investment than Eskay Mining. However, THRACE PLASTICS is 3.82 times less risky than Eskay Mining. It trades about 0.02 of its potential returns per unit of risk. Eskay Mining Corp is currently generating about -0.03 per unit of risk. If you would invest 389.00 in THRACE PLASTICS on October 15, 2024 and sell it today you would earn a total of 26.00 from holding THRACE PLASTICS or generate 6.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
THRACE PLASTICS vs. Eskay Mining Corp
Performance |
| Timeline |
| THRACE PLASTICS |
| Eskay Mining Corp |
THRACE PLASTICS and Eskay Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with THRACE PLASTICS and Eskay Mining
The main advantage of trading using opposite THRACE PLASTICS and Eskay Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THRACE PLASTICS position performs unexpectedly, Eskay Mining 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 Eskay Mining will offset losses from the drop in Eskay Mining's long position.| THRACE PLASTICS vs. Coor Service Management | THRACE PLASTICS vs. AECOM TECHNOLOGY | THRACE PLASTICS vs. Motorcar Parts of | THRACE PLASTICS vs. Take Two Interactive Software |
| Eskay Mining vs. FIREWEED METALS P | Eskay Mining vs. YATRA ONLINE DL 0001 | Eskay Mining vs. SALESFORCE INC CDR | Eskay Mining vs. Fortescue Metals Group |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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