Correlation Between Purepoint Uranium and Peninsula Energy

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

By analyzing existing cross correlation between Purepoint Uranium Group and Peninsula Energy, you can compare the effects of market volatilities on Purepoint Uranium and Peninsula Energy 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 Purepoint Uranium with a short position of Peninsula Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Purepoint Uranium and Peninsula Energy.

Diversification Opportunities for Purepoint Uranium and Peninsula Energy

-0.79

Correlation Coefficient

Purepoint Uranium  Peninsula Energy

Pay attention - limited upside

The 3 months correlation between Purepoint and Peninsula is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Purepoint Uranium Group and Peninsula Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peninsula Energy and Purepoint Uranium 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 Purepoint Uranium Group are associated (or correlated) with Peninsula Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peninsula Energy has no effect on the direction of Purepoint Uranium i.e., Purepoint Uranium and Peninsula Energy go up and down completely randomly.

Pair Corralation between Purepoint Uranium and Peninsula Energy

Assuming the 90 days horizon Purepoint Uranium Group is expected to under-perform the Peninsula Energy. But the otc stock apears to be less risky and, when comparing its historical volatility, Purepoint Uranium Group is 18.3 times less risky than Peninsula Energy. The otc stock trades about -0.03 of its potential returns per unit of risk. The Peninsula Energy is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  6.67  in Peninsula Energy on October 26, 2024 and sell it today you would earn a total of  95.33  from holding Peninsula Energy or generate 1429.24% return on investment over 90 days.

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

Purepoint Uranium Group  vs.  Peninsula Energy

Purepoint Uranium

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Purepoint Uranium Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Peninsula Energy

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Peninsula Energy are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile primary indicators, Peninsula Energy reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Purepoint Uranium and Peninsula Energy

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

The idea behind Purepoint Uranium Group and Peninsula Energy 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.