Cmc Metals Stock Volatility
| CMCXF Stock | USD 0.01 0.01 25.00% |
CMC Metals is out of control given 3 months investment horizon. CMC Metals retains Efficiency (Sharpe Ratio) of 0.15, which signifies that the company had a 0.15% return per unit of risk over the last 3 months. We have analyzed and interpolated twenty-nine different technical indicators, which can help you to evaluate if expected returns of 5.86% are justified by taking the suggested risk. Use CMC Metals coefficient of variation of 685.11, and Market Risk Adjusted Performance of 0.6833 to evaluate company specific risk that cannot be diversified away. Key indicators related to CMC Metals' volatility include:
30 Days Market Risk | Chance Of Distress | 30 Days Economic Sensitivity |
CMC Metals OTC Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of CMC daily returns, and it is calculated using variance and standard deviation. We also use CMC's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of CMC Metals volatility.
CMC |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as CMC Metals can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game as hey may decide to buy additional stocks of CMC Metals at lower prices to lower their average cost per share. Similarly, when the prices of CMC Metals' stock rise, investors can sell out and invest the proceeds in other equities with better opportunities.
CMC Metals Market Sensitivity And Downside Risk
CMC Metals' beta coefficient measures the volatility of CMC otc stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents CMC otc stock's returns against your selected market. In other words, CMC Metals's beta of 8.42 provides an investor with an approximation of how much risk CMC Metals otc stock can potentially add to one of your existing portfolios. CMC Metals is showing large volatility of returns over the selected time horizon. CMC Metals is a penny stock. Although CMC Metals may be in fact a good investment, many penny otc stocks are subject to artificial price hype. Make sure you completely understand the upside potential and downside risk of investing in CMC Metals. We encourage investors to look for signals such as message board hypes, claims of breakthroughs, email spams, sudden volume upswings, and other similar hype indicators. We also encourage traders to check biographies and work history of company officers before investing in instruments with high volatility. You can indeed make money on CMC instrument if you perfectly time your entry and exit. However, remember that penny otcs that have been the subject of artificial hype usually unable to maintain their increased share price for more than just a few days. The price of a promoted high volatility instrument will almost always revert back. The only way to increase shareholder value is through legitimate performance backed up by solid fundamentals.
3 Months Beta |Analyze CMC Metals Demand TrendCheck current 90 days CMC Metals correlation with market (Dow Jones Industrial)CMC Beta |
CMC standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 39.53 |
It is essential to understand the difference between upside risk (as represented by CMC Metals's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of CMC Metals' daily returns or price. Since the actual investment returns on holding a position in cmc otc stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in CMC Metals.
CMC Metals OTC Stock Volatility Analysis
Volatility refers to the frequency at which CMC Metals otc price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with CMC Metals' price changes. Investors will then calculate the volatility of CMC Metals' otc stock to predict their future moves. A otc that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A otc stock with relatively stable price changes has low volatility. A highly volatile otc is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of CMC Metals' volatility:
Historical Volatility
This type of otc volatility measures CMC Metals' fluctuations based on previous trends. It's commonly used to predict CMC Metals' future behavior based on its past. However, it cannot conclusively determine the future direction of the otc stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for CMC Metals' current market price. This means that the otc will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on CMC Metals' to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. CMC Metals Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
CMC Metals Projected Return Density Against Market
Assuming the 90 days horizon the otc stock has the beta coefficient of 8.4237 suggesting as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, CMC Metals will likely underperform.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to CMC Metals or Metals & Mining sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that CMC Metals' price will be affected by overall otc stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a CMC otc's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
CMC Metals has an alpha of 4.6999, implying that it can generate a 4.7 percent excess return over Dow Jones Industrial after adjusting for the inherited market risk (beta). Predicted Return Density |
| Returns |
What Drives a CMC Metals Price Volatility?
Several factors can influence a otc's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.CMC Metals OTC Stock Risk Measures
Assuming the 90 days horizon the coefficient of variation of CMC Metals is 674.59. The daily returns are distributed with a variance of 1562.34 and standard deviation of 39.53. The mean deviation of CMC Metals is currently at 23.54. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.77
α | Alpha over Dow Jones | 4.70 | |
β | Beta against Dow Jones | 8.42 | |
σ | Overall volatility | 39.53 | |
Ir | Information ratio | 0.14 |
CMC Metals OTC Stock Return Volatility
CMC Metals historical daily return volatility represents how much of CMC Metals otc's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company shows 39.5265% volatility of returns over 90 . By contrast, Dow Jones Industrial accepts 0.7777% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About CMC Metals Volatility
Volatility is a rate at which the price of CMC Metals or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of CMC Metals may increase or decrease. In other words, similar to CMC's beta indicator, it measures the risk of CMC Metals and helps estimate the fluctuations that may happen in a short period of time. So if prices of CMC Metals fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.CMC Metals Ltd. engages in the acquisition and exploration of mineral properties in Canada and the United States. CMC Metals Ltd. was incorporated in 1996 and is headquartered in Vancouver, Canada. Cmc Metals operates under Other Precious Metals Mining classification in the United States and is traded on OTC Exchange.
CMC Metals' stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on CMC OTC Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much CMC Metals' price varies over time.
3 ways to utilize CMC Metals' volatility to invest better
Higher CMC Metals' stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of CMC Metals stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. CMC Metals stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of CMC Metals investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in CMC Metals' stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of CMC Metals' stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
CMC Metals Investment Opportunity
CMC Metals has a volatility of 39.53 and is 50.68 times more volatile than Dow Jones Industrial. Compared to the overall equity markets, volatility of historical daily returns of CMC Metals is higher than 96 percent of all global equities and portfolios over the last 90 days. You can use CMC Metals to protect your portfolios against small market fluctuations. The otc stock experiences a very speculative downward sentiment. The market maybe over-reacting. Check odds of CMC Metals to be traded at $0.0143 in 90 days.Average diversification
The correlation between CMC Metals and DJI is 0.17 (i.e., Average diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding CMC Metals and DJI in the same portfolio, assuming nothing else is changed.
CMC Metals Additional Risk Indicators
The analysis of CMC Metals' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in CMC Metals' investment and either accepting that risk or mitigating it. Along with some common measures of CMC Metals otc stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.1217 | |||
| Market Risk Adjusted Performance | 0.6833 | |||
| Mean Deviation | 22.87 | |||
| Semi Deviation | 18.87 | |||
| Downside Deviation | 50.78 | |||
| Coefficient Of Variation | 685.11 | |||
| Standard Deviation | 38.93 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential otc stocks, we recommend comparing similar otcs with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
CMC Metals Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against CMC Metals as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. CMC Metals' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, CMC Metals' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to CMC Metals.
Complementary Tools for CMC OTC Stock analysis
When running CMC Metals' price analysis, check to measure CMC Metals' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy CMC Metals is operating at the current time. Most of CMC Metals' value examination focuses on studying past and present price action to predict the probability of CMC Metals' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move CMC Metals' price. Additionally, you may evaluate how the addition of CMC Metals to your portfolios can decrease your overall portfolio volatility.
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