Correlation Between Talisman Mining and COAST ENTERTAINMENT

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Can any of the company-specific risk be diversified away by investing in both Talisman Mining and COAST ENTERTAINMENT 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 Talisman Mining and COAST ENTERTAINMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Talisman Mining and COAST ENTERTAINMENT HOLDINGS, you can compare the effects of market volatilities on Talisman Mining and COAST ENTERTAINMENT 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 Talisman Mining with a short position of COAST ENTERTAINMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Talisman Mining and COAST ENTERTAINMENT.

Diversification Opportunities for Talisman Mining and COAST ENTERTAINMENT

-0.23
  Correlation Coefficient

Very good diversification

The 3 months correlation between Talisman and COAST is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Talisman Mining and COAST ENTERTAINMENT HOLDINGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COAST ENTERTAINMENT and Talisman 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 Talisman Mining are associated (or correlated) with COAST ENTERTAINMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COAST ENTERTAINMENT has no effect on the direction of Talisman Mining i.e., Talisman Mining and COAST ENTERTAINMENT go up and down completely randomly.

Pair Corralation between Talisman Mining and COAST ENTERTAINMENT

Assuming the 90 days trading horizon Talisman Mining is expected to generate 2.21 times more return on investment than COAST ENTERTAINMENT. However, Talisman Mining is 2.21 times more volatile than COAST ENTERTAINMENT HOLDINGS. It trades about 0.04 of its potential returns per unit of risk. COAST ENTERTAINMENT HOLDINGS is currently generating about -0.02 per unit of risk. If you would invest  16.00  in Talisman Mining on October 26, 2024 and sell it today you would earn a total of  5.00  from holding Talisman Mining or generate 31.25% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Talisman Mining  vs.  COAST ENTERTAINMENT HOLDINGS

 Performance 
       Timeline  
Talisman Mining 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Talisman Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's primary indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.
COAST ENTERTAINMENT 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in COAST ENTERTAINMENT HOLDINGS are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical indicators, COAST ENTERTAINMENT may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Talisman Mining and COAST ENTERTAINMENT Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Talisman Mining and COAST ENTERTAINMENT

The main advantage of trading using opposite Talisman Mining and COAST ENTERTAINMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Talisman Mining position performs unexpectedly, COAST ENTERTAINMENT 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 COAST ENTERTAINMENT will offset losses from the drop in COAST ENTERTAINMENT's long position.
The idea behind Talisman Mining and COAST ENTERTAINMENT HOLDINGS 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.

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