Correlation Between St-Georges Eco-Mining and Cypress Development

Can any of the company-specific risk be diversified away by investing in both St-Georges Eco-Mining and Cypress Development 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 St-Georges Eco-Mining and Cypress Development into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for St-Georges Eco-Mining and Cypress Development

-0.21

Correlation Coefficient

St-Georges Eco-Mining  Cypress Development

Very good diversification

The 3 months correlation between St-Georges and Cypress is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding St Georges Eco Mining Corp and Cypress Development Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cypress Development Corp and St-Georges Eco-Mining 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 St Georges Eco Mining Corp are associated (or correlated) with Cypress Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cypress Development Corp has no effect on the direction of St-Georges Eco-Mining i.e., St-Georges Eco-Mining and Cypress Development go up and down completely randomly.

Pair Corralation between St-Georges Eco-Mining and Cypress Development

Assuming the 90 days horizon St Georges Eco Mining Corp is expected to generate 1.41 times more return on investment than Cypress Development. However, St-Georges Eco-Mining is 1.41 times more volatile than Cypress Development Corp. It trades about 0.24 of its potential returns per unit of risk. Cypress Development Corp is currently generating about 0.19 per unit of risk. If you would invest  3.68  in St Georges Eco Mining Corp on October 24, 2024 and sell it today you would earn a total of  1.59  from holding St Georges Eco Mining Corp or generate 43.21% return on investment over 90 days.

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

St Georges Eco Mining Corp  vs.  Cypress Development Corp

St-Georges Eco-Mining

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in St Georges Eco Mining Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly conflicting basic indicators, St-Georges Eco-Mining reported solid returns over the last few months and may actually be approaching a breakup point.

Cypress Development Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with St-Georges Eco-Mining and Cypress Development

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

The idea behind St Georges Eco Mining Corp and Cypress Development 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.

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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.