Correlation Between Centaurus Metals and Mincor Resources

Can any of the company-specific risk be diversified away by investing in both Centaurus Metals and Mincor Resources 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 Centaurus Metals and Mincor Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Centaurus Metals Limited and Mincor Resources NL, you can compare the effects of market volatilities on Centaurus Metals and Mincor Resources 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 Centaurus Metals with a short position of Mincor Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centaurus Metals and Mincor Resources.

Diversification Opportunities for Centaurus Metals and Mincor Resources

0.0

Correlation Coefficient

Centaurus Metals  Mincor Resources

Pay attention - limited upside

The 3 months correlation between Centaurus and Mincor is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Centaurus Metals Limited and Mincor Resources NL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mincor Resources and Centaurus Metals 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 Centaurus Metals Limited are associated (or correlated) with Mincor Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mincor Resources has no effect on the direction of Centaurus Metals i.e., Centaurus Metals and Mincor Resources go up and down completely randomly.

Pair Corralation between Centaurus Metals and Mincor Resources

If you would invest  22.00  in Centaurus Metals Limited on December 30, 2024 and sell it today you would earn a total of  2.00  from holding Centaurus Metals Limited or generate 9.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Centaurus Metals Limited  vs.  Mincor Resources NL

Centaurus Metals

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Centaurus Metals Limited are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Centaurus Metals reported solid returns over the last few months and may actually be approaching a breakup point.

Mincor Resources

Risk-Adjusted Performance

Very Weak

Over the last 90 days Mincor Resources NL has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Mincor Resources is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Centaurus Metals and Mincor Resources

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

The idea behind Centaurus Metals Limited and Mincor Resources NL 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.