Correlation Between X-FAB Silicon and Endeavour Mining
Can any of the company-specific risk be diversified away by investing in both X-FAB Silicon and Endeavour 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 X-FAB Silicon and Endeavour Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between X FAB Silicon Foundries and Endeavour Mining PLC, you can compare the effects of market volatilities on X-FAB Silicon and Endeavour 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 X-FAB Silicon with a short position of Endeavour Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of X-FAB Silicon and Endeavour Mining.
Diversification Opportunities for X-FAB Silicon and Endeavour Mining
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between X-FAB and Endeavour is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding X FAB Silicon Foundries and Endeavour Mining PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Endeavour Mining PLC and X-FAB Silicon 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 X FAB Silicon Foundries are associated (or correlated) with Endeavour Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Endeavour Mining PLC has no effect on the direction of X-FAB Silicon i.e., X-FAB Silicon and Endeavour Mining go up and down completely randomly.
Pair Corralation between X-FAB Silicon and Endeavour Mining
Assuming the 90 days trading horizon X FAB Silicon Foundries is expected to under-perform the Endeavour Mining. But the stock apears to be less risky and, when comparing its historical volatility, X FAB Silicon Foundries is 1.05 times less risky than Endeavour Mining. The stock trades about -0.07 of its potential returns per unit of risk. The Endeavour Mining PLC is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,756 in Endeavour Mining PLC on October 16, 2024 and sell it today you would lose (6.00) from holding Endeavour Mining PLC or give up 0.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
X FAB Silicon Foundries vs. Endeavour Mining PLC
Performance |
| Timeline |
| X FAB Silicon |
| Endeavour Mining PLC |
X-FAB Silicon and Endeavour Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with X-FAB Silicon and Endeavour Mining
The main advantage of trading using opposite X-FAB Silicon and Endeavour Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if X-FAB Silicon position performs unexpectedly, Endeavour 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 Endeavour Mining will offset losses from the drop in Endeavour Mining's long position.| X-FAB Silicon vs. Granite Construction | X-FAB Silicon vs. KINGBOARD CHEMICAL | X-FAB Silicon vs. Siamgas And Petrochemicals | X-FAB Silicon vs. Mitsubishi Gas Chemical |
| Endeavour Mining vs. CITY OFFICE REIT | Endeavour Mining vs. Mitsui Chemicals | Endeavour Mining vs. Corporate Office Properties | Endeavour Mining vs. X FAB Silicon Foundries |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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