Correlation Between Perseus Mining and Ebro Foods
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Ebro Foods 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 Perseus Mining and Ebro Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Perseus Mining Limited and Ebro Foods SA, you can compare the effects of market volatilities on Perseus Mining and Ebro Foods 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 Perseus Mining with a short position of Ebro Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Ebro Foods.
Diversification Opportunities for Perseus Mining and Ebro Foods
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Perseus and Ebro is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and Ebro Foods SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ebro Foods SA and Perseus 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 Perseus Mining Limited are associated (or correlated) with Ebro Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ebro Foods SA has no effect on the direction of Perseus Mining i.e., Perseus Mining and Ebro Foods go up and down completely randomly.
Pair Corralation between Perseus Mining and Ebro Foods
Assuming the 90 days horizon Perseus Mining Limited is expected to under-perform the Ebro Foods. In addition to that, Perseus Mining is 2.35 times more volatile than Ebro Foods SA. It trades about -0.02 of its total potential returns per unit of risk. Ebro Foods SA is currently generating about 0.02 per unit of volatility. If you would invest 1,570 in Ebro Foods SA on September 25, 2024 and sell it today you would earn a total of 10.00 from holding Ebro Foods SA or generate 0.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Perseus Mining Limited vs. Ebro Foods SA
Performance |
Timeline |
Perseus Mining |
Ebro Foods SA |
Perseus Mining and Ebro Foods Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Perseus Mining and Ebro Foods
The main advantage of trading using opposite Perseus Mining and Ebro Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Ebro Foods 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 Ebro Foods will offset losses from the drop in Ebro Foods' long position.Perseus Mining vs. PKSHA TECHNOLOGY INC | Perseus Mining vs. Jacquet Metal Service | Perseus Mining vs. FIREWEED METALS P | Perseus Mining vs. ORMAT TECHNOLOGIES |
Ebro Foods vs. JAPAN TOBACCO UNSPADR12 | Ebro Foods vs. GALENA MINING LTD | Ebro Foods vs. Perseus Mining Limited | Ebro Foods vs. BRIT AMER TOBACCO |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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