Correlation Between Orbit Garant and Capstone Mining
Can any of the company-specific risk be diversified away by investing in both Orbit Garant and Capstone 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 Orbit Garant and Capstone Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orbit Garant Drilling and Capstone Mining Corp, you can compare the effects of market volatilities on Orbit Garant and Capstone 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 Orbit Garant with a short position of Capstone Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orbit Garant and Capstone Mining.
Diversification Opportunities for Orbit Garant and Capstone Mining
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Orbit and Capstone is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Orbit Garant Drilling and Capstone Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capstone Mining Corp and Orbit Garant 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 Orbit Garant Drilling are associated (or correlated) with Capstone Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capstone Mining Corp has no effect on the direction of Orbit Garant i.e., Orbit Garant and Capstone Mining go up and down completely randomly.
Pair Corralation between Orbit Garant and Capstone Mining
Assuming the 90 days trading horizon Orbit Garant Drilling is expected to generate 1.46 times more return on investment than Capstone Mining. However, Orbit Garant is 1.46 times more volatile than Capstone Mining Corp. It trades about 0.14 of its potential returns per unit of risk. Capstone Mining Corp is currently generating about -0.07 per unit of risk. If you would invest 60.00 in Orbit Garant Drilling on September 25, 2024 and sell it today you would earn a total of 19.00 from holding Orbit Garant Drilling or generate 31.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Orbit Garant Drilling vs. Capstone Mining Corp
Performance |
Timeline |
Orbit Garant Drilling |
Capstone Mining Corp |
Orbit Garant and Capstone Mining Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Orbit Garant and Capstone Mining
The main advantage of trading using opposite Orbit Garant and Capstone Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orbit Garant position performs unexpectedly, Capstone 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 Capstone Mining will offset losses from the drop in Capstone Mining's long position.Orbit Garant vs. Foraco International SA | Orbit Garant vs. Geodrill Limited | Orbit Garant vs. Major Drilling Group | Orbit Garant vs. Mccoy Global |
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Check out your portfolio center.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.
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