Correlation Between Endeavour Mining and Aptitude Software

Can any of the company-specific risk be diversified away by investing in both Endeavour Mining and Aptitude Software 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 Endeavour Mining and Aptitude Software into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Endeavour Mining Corp and Aptitude Software Group, you can compare the effects of market volatilities on Endeavour Mining and Aptitude Software 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 Endeavour Mining with a short position of Aptitude Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Endeavour Mining and Aptitude Software.

Diversification Opportunities for Endeavour Mining and Aptitude Software

0.41

Correlation Coefficient

Endeavour Mining  Aptitude Software

Very weak diversification

The 3 months correlation between Endeavour and Aptitude is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Endeavour Mining Corp and Aptitude Software Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptitude Software and Endeavour Mining 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 Endeavour Mining Corp are associated (or correlated) with Aptitude Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptitude Software has no effect on the direction of Endeavour Mining i.e., Endeavour Mining and Aptitude Software go up and down completely randomly.

Pair Corralation between Endeavour Mining and Aptitude Software

Assuming the 90 days trading horizon Endeavour Mining Corp is expected to generate 0.93 times more return on investment than Aptitude Software. However, Endeavour Mining Corp is 1.08 times less risky than Aptitude Software. It trades about 0.22 of its potential returns per unit of risk. Aptitude Software Group is currently generating about -0.07 per unit of risk. If you would invest  143,200  in Endeavour Mining Corp on October 25, 2024 and sell it today you would earn a total of  11,000  from holding Endeavour Mining Corp or generate 7.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Endeavour Mining Corp  vs.  Aptitude Software Group

Endeavour Mining Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Endeavour Mining Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Aptitude Software

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aptitude Software Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Aptitude Software is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Endeavour Mining and Aptitude Software

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

The idea behind Endeavour Mining Corp and Aptitude Software Group 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.