Correlation Between Artemis Resources and CDN Maverick

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

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

Diversification Opportunities for Artemis Resources and CDN Maverick

-0.27

Correlation Coefficient

Artemis Resources  CDN Maverick

Very good diversification

The 3 months correlation between Artemis and CDN is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Artemis Resources and CDN Maverick Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDN Maverick Capital and Artemis Resources 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 Artemis Resources are associated (or correlated) with CDN Maverick. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDN Maverick Capital has no effect on the direction of Artemis Resources i.e., Artemis Resources and CDN Maverick go up and down completely randomly.

Pair Corralation between Artemis Resources and CDN Maverick

Assuming the 90 days horizon Artemis Resources is expected to generate 4.23 times more return on investment than CDN Maverick. However, Artemis Resources is 4.23 times more volatile than CDN Maverick Capital. It trades about 0.1 of its potential returns per unit of risk. CDN Maverick Capital is currently generating about 0.03 per unit of risk. If you would invest  1.00  in Artemis Resources on September 13, 2024 and sell it today you would lose (0.50) from holding Artemis Resources or give up 50.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Artemis Resources  vs.  CDN Maverick Capital

Artemis Resources

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Artemis Resources are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Artemis Resources reported solid returns over the last few months and may actually be approaching a breakup point.

CDN Maverick Capital

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CDN Maverick Capital are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, CDN Maverick reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Artemis Resources and CDN Maverick

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

The idea behind Artemis Resources and CDN Maverick Capital 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.