Correlation Between Sixty North and CEMATRIX

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

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

Diversification Opportunities for Sixty North and CEMATRIX

0.09

Correlation Coefficient

Sixty North  CEMATRIX

Significant diversification

The 3 months correlation between Sixty and CEMATRIX is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Sixty North Gold and CEMATRIX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEMATRIX and Sixty North 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 Sixty North Gold are associated (or correlated) with CEMATRIX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEMATRIX has no effect on the direction of Sixty North i.e., Sixty North and CEMATRIX go up and down completely randomly.

Pair Corralation between Sixty North and CEMATRIX

Assuming the 90 days horizon Sixty North Gold is expected to under-perform the CEMATRIX. In addition to that, Sixty North is 2.95 times more volatile than CEMATRIX. It trades about -0.03 of its total potential returns per unit of risk. CEMATRIX is currently generating about -0.06 per unit of volatility. If you would invest  20.00  in CEMATRIX on September 29, 2024 and sell it today you would lose (1.00) from holding CEMATRIX or give up 5.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Sixty North Gold  vs.  CEMATRIX

Sixty North Gold

Risk-Adjusted Performance

8 of 100

OK

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

CEMATRIX

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CEMATRIX has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, CEMATRIX is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Sixty North and CEMATRIX

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

The idea behind Sixty North Gold and CEMATRIX 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.