Correlation Between Vindicator Silver and CARPENTER

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

By analyzing existing cross correlation between Vindicator Silver Lead Mining and CARPENTER TECHNOLOGY P, you can compare the effects of market volatilities on Vindicator Silver and CARPENTER 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 Vindicator Silver with a short position of CARPENTER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vindicator Silver and CARPENTER.

Diversification Opportunities for Vindicator Silver and CARPENTER

0.23

Correlation Coefficient

Vindicator Silver  CARPENTER

Modest diversification

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

Pair Corralation between Vindicator Silver and CARPENTER

Given the investment horizon of 90 days Vindicator Silver Lead Mining is expected to generate 17.95 times more return on investment than CARPENTER. However, Vindicator Silver is 17.95 times more volatile than CARPENTER TECHNOLOGY P. It trades about 0.03 of its potential returns per unit of risk. CARPENTER TECHNOLOGY P is currently generating about 0.02 per unit of risk. If you would invest  30.00  in Vindicator Silver Lead Mining on September 16, 2024 and sell it today you would lose (18.00) from holding Vindicator Silver Lead Mining or give up 60.0% of portfolio value over 90 days.

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

Vindicator Silver Lead Mining  vs.  CARPENTER TECHNOLOGY P

Vindicator Silver Lead

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Vindicator Silver Lead Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

CARPENTER TECHNOLOGY

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CARPENTER TECHNOLOGY P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, CARPENTER is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Vindicator Silver and CARPENTER

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

The idea behind Vindicator Silver Lead Mining and CARPENTER TECHNOLOGY P 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.