Correlation Between Precious Metals and Enduro Metals

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

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

Diversification Opportunities for Precious Metals and Enduro Metals

-0.27

Correlation Coefficient

Precious Metals  Enduro Metals

Very good diversification

The 3 months correlation between Precious and Enduro is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Precious Metals And and Enduro Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enduro Metals Corp and Precious Metals 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 Precious Metals And are associated (or correlated) with Enduro Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enduro Metals Corp has no effect on the direction of Precious Metals i.e., Precious Metals and Enduro Metals go up and down completely randomly.

Pair Corralation between Precious Metals and Enduro Metals

Assuming the 90 days trading horizon Precious Metals And is expected to generate 0.3 times more return on investment than Enduro Metals. However, Precious Metals And is 3.35 times less risky than Enduro Metals. It trades about 0.08 of its potential returns per unit of risk. Enduro Metals Corp is currently generating about 0.01 per unit of risk. If you would invest  178.00  in Precious Metals And on December 1, 2024 and sell it today you would earn a total of  14.00  from holding Precious Metals And or generate 7.87% return on investment over 90 days.

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

Precious Metals And  vs.  Enduro Metals Corp

Precious Metals And

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Precious Metals And are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Precious Metals may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Enduro Metals Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Enduro Metals Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable fundamental indicators, Enduro Metals is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Precious Metals and Enduro Metals

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

The idea behind Precious Metals And and Enduro Metals 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.