Correlation Between 2028 Investment and Capstone Mining

Can any of the company-specific risk be diversified away by investing in both 2028 Investment and Capstone Mining 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 2028 Investment and Capstone Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 2028 Investment Grade and Capstone Mining Corp, you can compare the effects of market volatilities on 2028 Investment and Capstone Mining 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 2028 Investment with a short position of Capstone Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of 2028 Investment and Capstone Mining.

Diversification Opportunities for 2028 Investment and Capstone Mining

-0.08

Correlation Coefficient

2028 Investment  Capstone Mining

Good diversification

The 3 months correlation between 2028 and Capstone is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding 2028 Investment Grade and Capstone Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capstone Mining Corp and 2028 Investment 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 2028 Investment Grade are associated (or correlated) with Capstone Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capstone Mining Corp has no effect on the direction of 2028 Investment i.e., 2028 Investment and Capstone Mining go up and down completely randomly.

Pair Corralation between 2028 Investment and Capstone Mining

Assuming the 90 days trading horizon 2028 Investment is expected to generate 7.59 times less return on investment than Capstone Mining. But when comparing it to its historical volatility, 2028 Investment Grade is 3.88 times less risky than Capstone Mining. It trades about 0.03 of its potential returns per unit of risk. Capstone Mining Corp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  514.00  in Capstone Mining Corp on September 26, 2024 and sell it today you would earn a total of  386.00  from holding Capstone Mining Corp or generate 75.1% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	50.91%
Values	Daily Returns

2028 Investment Grade  vs.  Capstone Mining Corp

2028 Investment Grade

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days 2028 Investment Grade has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, 2028 Investment is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Capstone Mining Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Capstone Mining Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with 2028 Investment and Capstone Mining

The main advantage of trading using opposite 2028 Investment and Capstone Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 2028 Investment position performs unexpectedly, Capstone Mining 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 Capstone Mining will offset losses from the drop in Capstone Mining's long position.

The idea behind 2028 Investment Grade and Capstone Mining Corp 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.