Correlation Between Senvest Capital and Metalero Mining

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

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

Diversification Opportunities for Senvest Capital and Metalero Mining

-0.52

Correlation Coefficient

Senvest Capital  Metalero Mining

Excellent diversification

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

Pair Corralation between Senvest Capital and Metalero Mining

Assuming the 90 days trading horizon Senvest Capital is expected to generate 0.18 times more return on investment than Metalero Mining. However, Senvest Capital is 5.54 times less risky than Metalero Mining. It trades about 0.19 of its potential returns per unit of risk. Metalero Mining Corp is currently generating about 0.01 per unit of risk. If you would invest  32,800  in Senvest Capital on September 22, 2024 and sell it today you would earn a total of  2,200  from holding Senvest Capital or generate 6.71% return on investment over 90 days.

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

Senvest Capital  vs.  Metalero Mining Corp

Senvest Capital

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Senvest Capital are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal fundamental indicators, Senvest Capital may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Metalero Mining Corp

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Metalero Mining Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Metalero Mining is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Senvest Capital and Metalero Mining

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

The idea behind Senvest Capital and Metalero Mining Corp 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.

Check out your portfolio center.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.