Correlation Between Wealthsimple Shariah and Magnum Mining
Can any of the company-specific risk be diversified away by investing in both Wealthsimple Shariah and Magnum 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 Wealthsimple Shariah and Magnum Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wealthsimple Shariah World and Magnum Mining and, you can compare the effects of market volatilities on Wealthsimple Shariah and Magnum 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 Wealthsimple Shariah with a short position of Magnum Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wealthsimple Shariah and Magnum Mining.
Diversification Opportunities for Wealthsimple Shariah and Magnum Mining
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Wealthsimple and Magnum is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Wealthsimple Shariah World and Magnum Mining and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magnum Mining and Wealthsimple Shariah 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 Wealthsimple Shariah World are associated (or correlated) with Magnum Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magnum Mining has no effect on the direction of Wealthsimple Shariah i.e., Wealthsimple Shariah and Magnum Mining go up and down completely randomly.
Pair Corralation between Wealthsimple Shariah and Magnum Mining
Assuming the 90 days trading horizon Wealthsimple Shariah is expected to generate 187.4 times less return on investment than Magnum Mining. But when comparing it to its historical volatility, Wealthsimple Shariah World is 16.5 times less risky than Magnum Mining. It trades about 0.0 of its potential returns per unit of risk. Magnum Mining and is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 0.70 in Magnum Mining and on August 21, 2025 and sell it today you would lose (0.10) from holding Magnum Mining and or give up 14.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Wealthsimple Shariah World vs. Magnum Mining and
Performance |
| Timeline |
| Wealthsimple Shariah |
| Magnum Mining |
Wealthsimple Shariah and Magnum Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wealthsimple Shariah and Magnum Mining
The main advantage of trading using opposite Wealthsimple Shariah and Magnum Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wealthsimple Shariah position performs unexpectedly, Magnum 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 Magnum Mining will offset losses from the drop in Magnum Mining's long position.| Wealthsimple Shariah vs. Wealthsimple North America | Wealthsimple Shariah vs. Wealthsimple Developed Markets | Wealthsimple Shariah vs. Wealthsimple North American | Wealthsimple Shariah vs. NBI High Yield |
| Magnum Mining vs. Northern Star Resources | Magnum Mining vs. Evolution Mining | Magnum Mining vs. Alcoa | Magnum Mining vs. Bluescope Steel |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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