Correlation Between Excellon Resources and Dividend

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Can any of the company-specific risk be diversified away by investing in both Excellon Resources and Dividend 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 Excellon Resources and Dividend into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Excellon Resources and Dividend 15 Split, you can compare the effects of market volatilities on Excellon Resources and Dividend 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 Excellon Resources with a short position of Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Excellon Resources and Dividend.

Diversification Opportunities for Excellon Resources and Dividend

-0.72
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Excellon and Dividend is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Excellon Resources and Dividend 15 Split in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dividend 15 Split and Excellon Resources 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 Excellon Resources are associated (or correlated) with Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dividend 15 Split has no effect on the direction of Excellon Resources i.e., Excellon Resources and Dividend go up and down completely randomly.

Pair Corralation between Excellon Resources and Dividend

Assuming the 90 days trading horizon Excellon Resources is expected to generate 1.42 times less return on investment than Dividend. In addition to that, Excellon Resources is 18.58 times more volatile than Dividend 15 Split. It trades about 0.01 of its total potential returns per unit of risk. Dividend 15 Split is currently generating about 0.17 per unit of volatility. If you would invest  1,018  in Dividend 15 Split on October 12, 2024 and sell it today you would earn a total of  36.00  from holding Dividend 15 Split or generate 3.54% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Excellon Resources  vs.  Dividend 15 Split

 Performance 
       Timeline  
Excellon Resources 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Excellon Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Excellon Resources is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.
Dividend 15 Split 

Risk-Adjusted Performance

13 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Dividend 15 Split are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Dividend is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Excellon Resources and Dividend Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Excellon Resources and Dividend

The main advantage of trading using opposite Excellon Resources and Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Excellon Resources position performs unexpectedly, Dividend 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 Dividend will offset losses from the drop in Dividend's long position.
The idea behind Excellon Resources and Dividend 15 Split 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.

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