Correlation Between Mundoro Capital and Commander Resources

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

By analyzing existing cross correlation between Mundoro Capital and Commander Resources, you can compare the effects of market volatilities on Mundoro Capital and Commander Resources 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 Mundoro Capital with a short position of Commander Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mundoro Capital and Commander Resources.

Diversification Opportunities for Mundoro Capital and Commander Resources

-0.01

Correlation Coefficient

Mundoro Capital  Commander Resources

Good diversification

The 3 months correlation between Mundoro and Commander is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Mundoro Capital and Commander Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commander Resources and Mundoro Capital 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 Mundoro Capital are associated (or correlated) with Commander Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commander Resources has no effect on the direction of Mundoro Capital i.e., Mundoro Capital and Commander Resources go up and down completely randomly.

Pair Corralation between Mundoro Capital and Commander Resources

Assuming the 90 days horizon Mundoro Capital is expected to generate 0.39 times more return on investment than Commander Resources. However, Mundoro Capital is 2.56 times less risky than Commander Resources. It trades about 0.01 of its potential returns per unit of risk. Commander Resources is currently generating about -0.18 per unit of risk. If you would invest  18.00  in Mundoro Capital on October 9, 2024 and sell it today you would earn a total of  0.00  from holding Mundoro Capital or generate 0.0% return on investment over 90 days.

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

Mundoro Capital  vs.  Commander Resources

Mundoro Capital

Risk-Adjusted Performance

0 of 100

Very Weak

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

Commander Resources

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Commander Resources are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Commander Resources showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Mundoro Capital and Commander Resources

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

The idea behind Mundoro Capital and Commander Resources 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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.