Correlation Between Aspire Mining and Peel Mining

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

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

Diversification Opportunities for Aspire Mining and Peel Mining

0.06

Correlation Coefficient

Aspire Mining  Peel Mining

Significant diversification

The 3 months correlation between Aspire and Peel is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Aspire Mining and Peel Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peel Mining and Aspire 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 Aspire Mining are associated (or correlated) with Peel Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peel Mining has no effect on the direction of Aspire Mining i.e., Aspire Mining and Peel Mining go up and down completely randomly.

Pair Corralation between Aspire Mining and Peel Mining

Assuming the 90 days trading horizon Aspire Mining is expected to under-perform the Peel Mining. But the stock apears to be less risky and, when comparing its historical volatility, Aspire Mining is 1.16 times less risky than Peel Mining. The stock trades about -0.07 of its potential returns per unit of risk. The Peel Mining is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  13.00  in Peel Mining on September 27, 2024 and sell it today you would lose (1.00) from holding Peel Mining or give up 7.69% of portfolio value over 90 days.

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

Aspire Mining  vs.  Peel Mining

Aspire Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aspire 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 January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Peel Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Peel Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Peel Mining 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 Aspire Mining and Peel Mining

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

The idea behind Aspire Mining and Peel Mining 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.