Correlation Between Capitan Mining and Ag Growth

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

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

Diversification Opportunities for Capitan Mining and Ag Growth

0.78

Correlation Coefficient

Capitan Mining  Ag Growth

Poor diversification

The 3 months correlation between Capitan and AFN is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Capitan Mining and Ag Growth International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ag Growth International and Capitan 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 Capitan Mining are associated (or correlated) with Ag Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ag Growth International has no effect on the direction of Capitan Mining i.e., Capitan Mining and Ag Growth go up and down completely randomly.

Pair Corralation between Capitan Mining and Ag Growth

Assuming the 90 days trading horizon Capitan Mining is expected to generate 4.44 times more return on investment than Ag Growth. However, Capitan Mining is 4.44 times more volatile than Ag Growth International. It trades about 0.2 of its potential returns per unit of risk. Ag Growth International is currently generating about 0.25 per unit of risk. If you would invest  41.00  in Capitan Mining on April 22, 2025 and sell it today you would earn a total of  54.00  from holding Capitan Mining or generate 131.71% return on investment over 90 days.

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

Capitan Mining  vs.  Ag Growth International

Capitan Mining

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Capitan Mining are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Capitan Mining showed solid returns over the last few months and may actually be approaching a breakup point.

Ag Growth International

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ag Growth International are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Ag Growth displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Capitan Mining and Ag Growth

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

The idea behind Capitan Mining and Ag Growth International 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.