Correlation Between Young Cos and Thor Mining
Can any of the company-specific risk be diversified away by investing in both Young Cos and Thor 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 Young Cos and Thor Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Young Cos Brewery and Thor Mining PLC, you can compare the effects of market volatilities on Young Cos and Thor 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 Young Cos with a short position of Thor Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Young Cos and Thor Mining.
Diversification Opportunities for Young Cos and Thor Mining
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Young and Thor is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Young Cos Brewery and Thor Mining PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thor Mining PLC and Young Cos 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 Young Cos Brewery are associated (or correlated) with Thor Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thor Mining PLC has no effect on the direction of Young Cos i.e., Young Cos and Thor Mining go up and down completely randomly.
Pair Corralation between Young Cos and Thor Mining
Assuming the 90 days trading horizon Young Cos Brewery is expected to generate 0.41 times more return on investment than Thor Mining. However, Young Cos Brewery is 2.46 times less risky than Thor Mining. It trades about -0.03 of its potential returns per unit of risk. Thor Mining PLC is currently generating about -0.06 per unit of risk. If you would invest 81,276 in Young Cos Brewery on August 26, 2024 and sell it today you would lose (19,076) from holding Young Cos Brewery or give up 23.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Young Cos Brewery vs. Thor Mining PLC
Performance |
| Timeline |
| Young Cos Brewery |
| Thor Mining PLC |
Young Cos and Thor Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Young Cos and Thor Mining
The main advantage of trading using opposite Young Cos and Thor Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Young Cos position performs unexpectedly, Thor 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 Thor Mining will offset losses from the drop in Thor Mining's long position.| Young Cos vs. Samsung Electronics Co | Young Cos vs. Samsung Electronics Co | Young Cos vs. Toyota Motor Corp | Young Cos vs. Hon Hai Precision |
| Thor Mining vs. Givaudan SA | Thor Mining vs. Antofagasta PLC | Thor Mining vs. Centamin PLC | Thor Mining vs. Atalaya Mining |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |