Correlation Between Collective Mining and Artemis Gold

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

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

Diversification Opportunities for Collective Mining and Artemis Gold

0.72

Correlation Coefficient

Collective Mining  Artemis Gold

Poor diversification

The 3 months correlation between Collective and Artemis is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Collective Mining and Artemis Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artemis Gold and Collective 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 Collective Mining are associated (or correlated) with Artemis Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artemis Gold has no effect on the direction of Collective Mining i.e., Collective Mining and Artemis Gold go up and down completely randomly.

Pair Corralation between Collective Mining and Artemis Gold

Assuming the 90 days horizon Collective Mining is expected to under-perform the Artemis Gold. But the otc stock apears to be less risky and, when comparing its historical volatility, Collective Mining is 1.23 times less risky than Artemis Gold. The otc stock trades about -0.36 of its potential returns per unit of risk. The Artemis Gold is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  651.00  in Artemis Gold on February 7, 2024 and sell it today you would lose (11.00) from holding Artemis Gold or give up 1.69% of portfolio value over 90 days.

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

Collective Mining  vs.  Artemis Gold

Collective Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Collective Mining has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable primary indicators, Collective Mining is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Artemis Gold

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Artemis Gold are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Artemis Gold reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Collective Mining and Artemis Gold

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

The idea behind Collective Mining and Artemis Gold 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.