Correlation Between Supermarket Income and AfriTin Mining

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

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

Diversification Opportunities for Supermarket Income and AfriTin Mining

0.73

Correlation Coefficient

Supermarket Income  AfriTin Mining

Poor diversification

The 3 months correlation between Supermarket and AfriTin is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Supermarket Income REIT and AfriTin Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AfriTin Mining and Supermarket Income 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 Supermarket Income REIT are associated (or correlated) with AfriTin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AfriTin Mining has no effect on the direction of Supermarket Income i.e., Supermarket Income and AfriTin Mining go up and down completely randomly.

Pair Corralation between Supermarket Income and AfriTin Mining

Assuming the 90 days trading horizon Supermarket Income is expected to generate 2.55 times less return on investment than AfriTin Mining. But when comparing it to its historical volatility, Supermarket Income REIT is 3.41 times less risky than AfriTin Mining. It trades about 0.04 of its potential returns per unit of risk. AfriTin Mining is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  220.00  in AfriTin Mining on October 20, 2024 and sell it today you would earn a total of  5.00  from holding AfriTin Mining or generate 2.27% return on investment over 90 days.

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

Supermarket Income REIT  vs.  AfriTin Mining

Supermarket Income REIT

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Supermarket Income REIT has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Supermarket Income is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

AfriTin Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AfriTin Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady 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 Supermarket Income and AfriTin Mining

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

The idea behind Supermarket Income REIT and AfriTin 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.