Correlation Between THARISA NON and Fresnillo Plc

Can any of the company-specific risk be diversified away by investing in both THARISA NON and Fresnillo Plc 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 THARISA NON and Fresnillo Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between THARISA NON LIST and Fresnillo plc, you can compare the effects of market volatilities on THARISA NON and Fresnillo Plc 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 THARISA NON with a short position of Fresnillo Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of THARISA NON and Fresnillo Plc.

Diversification Opportunities for THARISA NON and Fresnillo Plc

-0.44

Correlation Coefficient

THARISA NON  Fresnillo Plc

Very good diversification

The 3 months correlation between THARISA and Fresnillo is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding THARISA NON LIST and Fresnillo plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fresnillo plc and THARISA NON 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 THARISA NON LIST are associated (or correlated) with Fresnillo Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fresnillo plc has no effect on the direction of THARISA NON i.e., THARISA NON and Fresnillo Plc go up and down completely randomly.

Pair Corralation between THARISA NON and Fresnillo Plc

Assuming the 90 days horizon THARISA NON LIST is expected to under-perform the Fresnillo Plc. But the stock apears to be less risky and, when comparing its historical volatility, THARISA NON LIST is 1.2 times less risky than Fresnillo Plc. The stock trades about -0.12 of its potential returns per unit of risk. The Fresnillo plc is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  640.00  in Fresnillo plc on September 2, 2024 and sell it today you would earn a total of  155.00  from holding Fresnillo plc or generate 24.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.48%
Values	Daily Returns

THARISA NON LIST  vs.  Fresnillo plc

THARISA NON LIST

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days THARISA NON LIST has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Fresnillo plc

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fresnillo plc are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Fresnillo Plc reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with THARISA NON and Fresnillo Plc

The main advantage of trading using opposite THARISA NON and Fresnillo Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THARISA NON position performs unexpectedly, Fresnillo Plc 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 Fresnillo Plc will offset losses from the drop in Fresnillo Plc's long position.

The idea behind THARISA NON LIST and Fresnillo plc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.