Correlation Between Proficient Auto and Perseus Mining

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

By analyzing existing cross correlation between Proficient Auto Logistics, and Perseus Mining Limited, you can compare the effects of market volatilities on Proficient Auto and Perseus 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 Proficient Auto with a short position of Perseus Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Proficient Auto and Perseus Mining.

Diversification Opportunities for Proficient Auto and Perseus Mining

-0.08

Correlation Coefficient

Proficient Auto  Perseus Mining

Good diversification

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

Pair Corralation between Proficient Auto and Perseus Mining

Considering the 90-day investment horizon Proficient Auto Logistics, is expected to generate 1.31 times more return on investment than Perseus Mining. However, Proficient Auto is 1.31 times more volatile than Perseus Mining Limited. It trades about 0.58 of its potential returns per unit of risk. Perseus Mining Limited is currently generating about 0.1 per unit of risk. If you would invest  768.00  in Proficient Auto Logistics, on October 24, 2024 and sell it today you would earn a total of  268.00  from holding Proficient Auto Logistics, or generate 34.9% return on investment over 90 days.

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

Proficient Auto Logistics,  vs.  Perseus Mining Limited

Proficient Auto Logi

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Proficient Auto Logistics, are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating basic indicators, Proficient Auto disclosed solid returns over the last few months and may actually be approaching a breakup point.

Perseus Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Perseus Mining Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak 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 Proficient Auto and Perseus Mining

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

The idea behind Proficient Auto Logistics, and Perseus Mining Limited 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.