Correlation Between Thor Mining and Dentsply Sirona

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

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

Diversification Opportunities for Thor Mining and Dentsply Sirona

-0.01

Correlation Coefficient

Thor Mining  Dentsply Sirona

Good diversification

The 3 months correlation between Thor and Dentsply is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Thor Mining PLC and Dentsply Sirona in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dentsply Sirona and Thor 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 Thor Mining PLC are associated (or correlated) with Dentsply Sirona. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dentsply Sirona has no effect on the direction of Thor Mining i.e., Thor Mining and Dentsply Sirona go up and down completely randomly.

Pair Corralation between Thor Mining and Dentsply Sirona

Assuming the 90 days trading horizon Thor Mining PLC is expected to generate 3.29 times more return on investment than Dentsply Sirona. However, Thor Mining is 3.29 times more volatile than Dentsply Sirona. It trades about -0.01 of its potential returns per unit of risk. Dentsply Sirona is currently generating about -0.02 per unit of risk. If you would invest  73.00  in Thor Mining PLC on November 29, 2024 and sell it today you would lose (8.00) from holding Thor Mining PLC or give up 10.96% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	93.44%
Values	Daily Returns

Thor Mining PLC  vs.  Dentsply Sirona

Thor Mining PLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days Thor Mining PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Thor Mining is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Dentsply Sirona

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Thor Mining and Dentsply Sirona

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

The idea behind Thor Mining PLC and Dentsply Sirona 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.