Correlation Between A Schulman and Orosur Mining

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

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

Diversification Opportunities for A Schulman and Orosur Mining

0.36

Correlation Coefficient

A Schulman  Orosur Mining

Weak diversification

The 3 months correlation between SLMNP and Orosur is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding A Schulman and Orosur Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orosur Mining and A Schulman 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 A Schulman are associated (or correlated) with Orosur Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orosur Mining has no effect on the direction of A Schulman i.e., A Schulman and Orosur Mining go up and down completely randomly.

Pair Corralation between A Schulman and Orosur Mining

Assuming the 90 days horizon A Schulman is expected to generate 33.36 times less return on investment than Orosur Mining. But when comparing it to its historical volatility, A Schulman is 15.89 times less risky than Orosur Mining. It trades about 0.04 of its potential returns per unit of risk. Orosur Mining is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  11.00  in Orosur Mining on December 20, 2024 and sell it today you would earn a total of  3.00  from holding Orosur Mining or generate 27.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	88.33%
Values	Daily Returns

A Schulman  vs.  Orosur Mining

A Schulman

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in A Schulman are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, A Schulman is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Orosur Mining

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Orosur Mining are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Orosur Mining reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with A Schulman and Orosur Mining

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

The idea behind A Schulman and Orosur 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.