Correlation Between Perseus Mining and Wilmington Capital

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and Wilmington Capital 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 Perseus Mining and Wilmington Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Perseus Mining and Wilmington Capital Management, you can compare the effects of market volatilities on Perseus Mining and Wilmington Capital 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 Perseus Mining with a short position of Wilmington Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and Wilmington Capital.

Diversification Opportunities for Perseus Mining and Wilmington Capital

-0.53
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Perseus and Wilmington is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining and Wilmington Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmington Capital and Perseus 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 Perseus Mining are associated (or correlated) with Wilmington Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmington Capital has no effect on the direction of Perseus Mining i.e., Perseus Mining and Wilmington Capital go up and down completely randomly.

Pair Corralation between Perseus Mining and Wilmington Capital

Assuming the 90 days trading horizon Perseus Mining is expected to generate 1.66 times less return on investment than Wilmington Capital. But when comparing it to its historical volatility, Perseus Mining is 1.58 times less risky than Wilmington Capital. It trades about 0.03 of its potential returns per unit of risk. Wilmington Capital Management is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  181.00  in Wilmington Capital Management on September 6, 2024 and sell it today you would earn a total of  69.00  from holding Wilmington Capital Management or generate 38.12% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy99.8%
ValuesDaily Returns

Perseus Mining  vs.  Wilmington Capital Management

 Performance 
       Timeline  
Perseus Mining 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Perseus Mining are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Perseus Mining displayed solid returns over the last few months and may actually be approaching a breakup point.
Wilmington Capital 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Wilmington Capital Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Wilmington Capital is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Perseus Mining and Wilmington Capital Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Perseus Mining and Wilmington Capital

The main advantage of trading using opposite Perseus Mining and Wilmington Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, Wilmington Capital 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 Wilmington Capital will offset losses from the drop in Wilmington Capital's long position.
The idea behind Perseus Mining and Wilmington Capital Management 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.
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.

Other Complementary Tools

Efficient Frontier
Plot and analyze your portfolio and positions against risk-return landscape of the market.
ETF Categories
List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Technical Analysis
Check basic technical indicators and analysis based on most latest market data
Watchlist Optimization
Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm