Correlation Between Robinsons Retail and Apex Mining

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

By analyzing existing cross correlation between Robinsons Retail Holdings and Apex Mining Co, you can compare the effects of market volatilities on Robinsons Retail and Apex 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 Robinsons Retail with a short position of Apex Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Robinsons Retail and Apex Mining.

Diversification Opportunities for Robinsons Retail and Apex Mining

0.82

Correlation Coefficient

Robinsons Retail  Apex Mining

Very poor diversification

The 3 months correlation between Robinsons and Apex is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Robinsons Retail Holdings and Apex Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apex Mining and Robinsons Retail 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 Robinsons Retail Holdings are associated (or correlated) with Apex Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apex Mining has no effect on the direction of Robinsons Retail i.e., Robinsons Retail and Apex Mining go up and down completely randomly.

Pair Corralation between Robinsons Retail and Apex Mining

Assuming the 90 days trading horizon Robinsons Retail Holdings is expected to generate 0.82 times more return on investment than Apex Mining. However, Robinsons Retail Holdings is 1.22 times less risky than Apex Mining. It trades about -0.14 of its potential returns per unit of risk. Apex Mining Co is currently generating about -0.14 per unit of risk. If you would invest  4,125  in Robinsons Retail Holdings on October 5, 2024 and sell it today you would lose (455.00) from holding Robinsons Retail Holdings or give up 11.03% of portfolio value over 90 days.

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

Robinsons Retail Holdings  vs.  Apex Mining Co

Robinsons Retail Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Robinsons Retail Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Apex Mining

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Robinsons Retail and Apex Mining

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

The idea behind Robinsons Retail Holdings and Apex Mining Co 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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.