Correlation Between Fission Uranium and International Frontier

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

By analyzing existing cross correlation between Fission Uranium Corp and International Frontier Resources, you can compare the effects of market volatilities on Fission Uranium and International Frontier 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 Fission Uranium with a short position of International Frontier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fission Uranium and International Frontier.

Diversification Opportunities for Fission Uranium and International Frontier

-0.4

Correlation Coefficient

Fission Uranium  International Frontier

Very good diversification

The 3 months correlation between Fission and International is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Fission Uranium Corp and International Frontier Resourc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Frontier and Fission Uranium 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 Fission Uranium Corp are associated (or correlated) with International Frontier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Frontier has no effect on the direction of Fission Uranium i.e., Fission Uranium and International Frontier go up and down completely randomly.

Pair Corralation between Fission Uranium and International Frontier

Assuming the 90 days trading horizon Fission Uranium is expected to generate 22.16 times less return on investment than International Frontier. But when comparing it to its historical volatility, Fission Uranium Corp is 4.87 times less risky than International Frontier. It trades about 0.05 of its potential returns per unit of risk. International Frontier Resources is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  6.00  in International Frontier Resources on January 29, 2024 and sell it today you would earn a total of  3.00  from holding International Frontier Resources or generate 50.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Fission Uranium Corp  vs.  International Frontier Resourc

Fission Uranium Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fission Uranium Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

International Frontier

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in International Frontier Resources are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, International Frontier showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fission Uranium and International Frontier

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

The idea behind Fission Uranium Corp and International Frontier Resources 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.