Correlation Between Mako Mining and Heliostar Metals

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

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

Diversification Opportunities for Mako Mining and Heliostar Metals

0.23

Correlation Coefficient

Mako Mining  Heliostar Metals

Modest diversification

The 3 months correlation between Mako and Heliostar is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Mako Mining Corp and Heliostar Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heliostar Metals and Mako 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 Mako Mining Corp are associated (or correlated) with Heliostar Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heliostar Metals has no effect on the direction of Mako Mining i.e., Mako Mining and Heliostar Metals go up and down completely randomly.

Pair Corralation between Mako Mining and Heliostar Metals

Assuming the 90 days horizon Mako Mining Corp is expected to generate 1.3 times more return on investment than Heliostar Metals. However, Mako Mining is 1.3 times more volatile than Heliostar Metals. It trades about 0.19 of its potential returns per unit of risk. Heliostar Metals is currently generating about -0.12 per unit of risk. If you would invest  213.00  in Mako Mining Corp on October 11, 2024 and sell it today you would earn a total of  36.00  from holding Mako Mining Corp or generate 16.9% return on investment over 90 days.

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

Mako Mining Corp  vs.  Heliostar Metals

Mako Mining Corp

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Mako Mining Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Mako Mining may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Heliostar Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Heliostar Metals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Mako Mining and Heliostar Metals

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

The idea behind Mako Mining Corp and Heliostar Metals 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.