Correlation Between Peel Mining and Marks
Can any of the company-specific risk be diversified away by investing in both Peel Mining and Marks 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 Peel Mining and Marks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peel Mining Limited and Marks and Spencer, you can compare the effects of market volatilities on Peel Mining and Marks 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 Peel Mining with a short position of Marks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peel Mining and Marks.
Diversification Opportunities for Peel Mining and Marks
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Peel and Marks is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Peel Mining Limited and Marks and Spencer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marks and Spencer and Peel 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 Peel Mining Limited are associated (or correlated) with Marks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marks and Spencer has no effect on the direction of Peel Mining i.e., Peel Mining and Marks go up and down completely randomly.
Pair Corralation between Peel Mining and Marks
Assuming the 90 days horizon Peel Mining is expected to generate 1.44 times less return on investment than Marks. In addition to that, Peel Mining is 2.82 times more volatile than Marks and Spencer. It trades about 0.03 of its total potential returns per unit of risk. Marks and Spencer is currently generating about 0.11 per unit of volatility. If you would invest 130.00 in Marks and Spencer on September 13, 2024 and sell it today you would earn a total of 345.00 from holding Marks and Spencer or generate 265.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peel Mining Limited vs. Marks and Spencer
Performance |
| Timeline |
| Peel Mining Limited |
| Marks and Spencer |
Peel Mining and Marks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peel Mining and Marks
The main advantage of trading using opposite Peel Mining and Marks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peel Mining position performs unexpectedly, Marks 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 Marks will offset losses from the drop in Marks' long position.| Peel Mining vs. American Lithium Corp | Peel Mining vs. ADRIATIC METALS LS 013355 | Peel Mining vs. Superior Plus Corp | Peel Mining vs. SIVERS SEMICONDUCTORS AB |
| Marks vs. STRAYER EDUCATION | Marks vs. Sportsmans Warehouse Holdings | Marks vs. JD SPORTS FASH | Marks vs. VIAPLAY GROUP AB |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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