Correlation Between Faraday Copper and Thor Explorations
Can any of the company-specific risk be diversified away by investing in both Faraday Copper and Thor Explorations 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 Faraday Copper and Thor Explorations into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Faraday Copper Corp and Thor Explorations, you can compare the effects of market volatilities on Faraday Copper and Thor Explorations 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 Faraday Copper with a short position of Thor Explorations. Check out your portfolio center. Please also check ongoing floating volatility patterns of Faraday Copper and Thor Explorations.
Diversification Opportunities for Faraday Copper and Thor Explorations
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Faraday and Thor is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Faraday Copper Corp and Thor Explorations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thor Explorations and Faraday Copper 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 Faraday Copper Corp are associated (or correlated) with Thor Explorations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thor Explorations has no effect on the direction of Faraday Copper i.e., Faraday Copper and Thor Explorations go up and down completely randomly.
Pair Corralation between Faraday Copper and Thor Explorations
Assuming the 90 days trading horizon Faraday Copper is expected to generate 87.29 times less return on investment than Thor Explorations. But when comparing it to its historical volatility, Faraday Copper Corp is 1.21 times less risky than Thor Explorations. It trades about 0.0 of its potential returns per unit of risk. Thor Explorations is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 30.00 in Thor Explorations on December 2, 2024 and sell it today you would earn a total of 8.00 from holding Thor Explorations or generate 26.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Faraday Copper Corp vs. Thor Explorations
Performance |
Timeline |
Faraday Copper Corp |
Thor Explorations |
Faraday Copper and Thor Explorations Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Faraday Copper and Thor Explorations
The main advantage of trading using opposite Faraday Copper and Thor Explorations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Faraday Copper position performs unexpectedly, Thor Explorations 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 Thor Explorations will offset losses from the drop in Thor Explorations' long position.Faraday Copper vs. Arizona Sonoran Copper | Faraday Copper vs. ATEX Resources | Faraday Copper vs. Marimaca Copper Corp |
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Check out your portfolio center.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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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