Correlation Between SIEM OFFSHORE and Evolution Mining

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

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

Diversification Opportunities for SIEM OFFSHORE and Evolution Mining

-0.52

Correlation Coefficient

SIEM OFFSHORE  Evolution Mining

Excellent diversification

The 3 months correlation between SIEM and Evolution is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding SIEM OFFSHORE NEW and Evolution Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolution Mining and SIEM OFFSHORE 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 SIEM OFFSHORE NEW are associated (or correlated) with Evolution Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolution Mining has no effect on the direction of SIEM OFFSHORE i.e., SIEM OFFSHORE and Evolution Mining go up and down completely randomly.

Pair Corralation between SIEM OFFSHORE and Evolution Mining

Assuming the 90 days trading horizon SIEM OFFSHORE NEW is expected to generate 1.2 times more return on investment than Evolution Mining. However, SIEM OFFSHORE is 1.2 times more volatile than Evolution Mining Limited. It trades about 0.05 of its potential returns per unit of risk. Evolution Mining Limited is currently generating about 0.05 per unit of risk. If you would invest  119.00  in SIEM OFFSHORE NEW on September 18, 2024 and sell it today you would earn a total of  93.00  from holding SIEM OFFSHORE NEW or generate 78.15% return on investment over 90 days.

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

SIEM OFFSHORE NEW  vs.  Evolution Mining Limited

SIEM OFFSHORE NEW

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SIEM OFFSHORE NEW has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's technical indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Evolution Mining

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Evolution Mining Limited are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Evolution Mining reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SIEM OFFSHORE and Evolution Mining

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

The idea behind SIEM OFFSHORE NEW and Evolution 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.