Correlation Between Daily Journal and Mascot Mines

Can any of the company-specific risk be diversified away by investing in both Daily Journal and Mascot Mines 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 Daily Journal and Mascot Mines into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Daily Journal Corp and Mascot Mines, you can compare the effects of market volatilities on Daily Journal and Mascot Mines 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 Daily Journal with a short position of Mascot Mines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daily Journal and Mascot Mines.

Diversification Opportunities for Daily Journal and Mascot Mines

0.0

Correlation Coefficient

Daily Journal  Mascot Mines

Pay attention - limited upside

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

Pair Corralation between Daily Journal and Mascot Mines

If you would invest  57,021  in Daily Journal Corp on October 9, 2024 and sell it today you would earn a total of  1,048  from holding Daily Journal Corp or generate 1.84% return on investment over 90 days.

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

Daily Journal Corp  vs.  Mascot Mines

Daily Journal Corp

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Daily Journal Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very weak fundamental indicators, Daily Journal displayed solid returns over the last few months and may actually be approaching a breakup point.

Mascot Mines

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mascot Mines has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy essential indicators, Mascot Mines is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Daily Journal and Mascot Mines

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

The idea behind Daily Journal Corp and Mascot Mines 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.