Correlation Between Panther Metals and AfriTin Mining

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

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

Diversification Opportunities for Panther Metals and AfriTin Mining

-0.57

Correlation Coefficient

Panther Metals  AfriTin Mining

Excellent diversification

The 3 months correlation between Panther and AfriTin is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Panther Metals PLC and AfriTin Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AfriTin Mining and Panther 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 Panther Metals PLC are associated (or correlated) with AfriTin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AfriTin Mining has no effect on the direction of Panther Metals i.e., Panther Metals and AfriTin Mining go up and down completely randomly.

Pair Corralation between Panther Metals and AfriTin Mining

Assuming the 90 days trading horizon Panther Metals PLC is expected to generate 1.15 times more return on investment than AfriTin Mining. However, Panther Metals is 1.15 times more volatile than AfriTin Mining. It trades about 0.0 of its potential returns per unit of risk. AfriTin Mining is currently generating about -0.11 per unit of risk. If you would invest  9,000  in Panther Metals PLC on September 30, 2024 and sell it today you would lose (750.00) from holding Panther Metals PLC or give up 8.33% of portfolio value over 90 days.

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

Panther Metals PLC  vs.  AfriTin Mining

Panther Metals PLC

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Panther Metals PLC are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Panther Metals may actually be approaching a critical reversion point that can send shares even higher in January 2025.

AfriTin Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AfriTin Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Panther Metals and AfriTin Mining

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

The idea behind Panther Metals PLC and AfriTin Mining 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.