Correlation Between Kraken Energy and Themac Resources
Can any of the company-specific risk be diversified away by investing in both Kraken Energy and Themac Resources 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 Kraken Energy and Themac Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kraken Energy Corp and Themac Resources Group, you can compare the effects of market volatilities on Kraken Energy and Themac Resources 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 Kraken Energy with a short position of Themac Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kraken Energy and Themac Resources.
Diversification Opportunities for Kraken Energy and Themac Resources
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kraken and Themac is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Kraken Energy Corp and Themac Resources Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Themac Resources and Kraken Energy 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 Kraken Energy Corp are associated (or correlated) with Themac Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Themac Resources has no effect on the direction of Kraken Energy i.e., Kraken Energy and Themac Resources go up and down completely randomly.
Pair Corralation between Kraken Energy and Themac Resources
Assuming the 90 days horizon Kraken Energy Corp is expected to under-perform the Themac Resources. But the otc stock apears to be less risky and, when comparing its historical volatility, Kraken Energy Corp is 2.37 times less risky than Themac Resources. The otc stock trades about -0.19 of its potential returns per unit of risk. The Themac Resources Group is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 2.50 in Themac Resources Group on August 29, 2024 and sell it today you would earn a total of 1.70 from holding Themac Resources Group or generate 68.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Kraken Energy Corp vs. Themac Resources Group
Performance |
| Timeline |
| Kraken Energy Corp |
| Themac Resources |
Kraken Energy and Themac Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kraken Energy and Themac Resources
The main advantage of trading using opposite Kraken Energy and Themac Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kraken Energy position performs unexpectedly, Themac Resources 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 Themac Resources will offset losses from the drop in Themac Resources' long position.| Kraken Energy vs. Avarone Metals | Kraken Energy vs. Adriatic Metals PLC | Kraken Energy vs. Aurelia Metals Limited | Kraken Energy vs. Huntsman Exploration |
| Themac Resources vs. Silver Hammer Mining | Themac Resources vs. Reyna Silver Corp | Themac Resources vs. Guanajuato Silver | Themac Resources vs. Silver One Resources |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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