Correlation Between Various Eateries and Thor Mining

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

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

Diversification Opportunities for Various Eateries and Thor Mining

0.51

Correlation Coefficient

Various Eateries  Thor Mining

Very weak diversification

The 3 months correlation between Various and Thor is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Various Eateries PLC and Thor Mining PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thor Mining PLC and Various Eateries 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 Various Eateries PLC are associated (or correlated) with Thor Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thor Mining PLC has no effect on the direction of Various Eateries i.e., Various Eateries and Thor Mining go up and down completely randomly.

Pair Corralation between Various Eateries and Thor Mining

Assuming the 90 days trading horizon Various Eateries PLC is expected to under-perform the Thor Mining. But the stock apears to be less risky and, when comparing its historical volatility, Various Eateries PLC is 6.23 times less risky than Thor Mining. The stock trades about -0.22 of its potential returns per unit of risk. The Thor Mining PLC is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  70.00  in Thor Mining PLC on December 23, 2024 and sell it today you would lose (10.00) from holding Thor Mining PLC or give up 14.29% of portfolio value over 90 days.

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

Various Eateries PLC  vs.  Thor Mining PLC

Various Eateries PLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days Various Eateries PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

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 latest unsteady performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Various Eateries and Thor Mining

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

The idea behind Various Eateries PLC and Thor Mining PLC 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.