Correlation Between Hecla Mining and Induction Healthcare
Can any of the company-specific risk be diversified away by investing in both Hecla Mining and Induction Healthcare 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 Hecla Mining and Induction Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hecla Mining Co and Induction Healthcare Group, you can compare the effects of market volatilities on Hecla Mining and Induction Healthcare 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 Hecla Mining with a short position of Induction Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hecla Mining and Induction Healthcare.
Diversification Opportunities for Hecla Mining and Induction Healthcare
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hecla and Induction is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Hecla Mining Co and Induction Healthcare Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Induction Healthcare and Hecla 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 Hecla Mining Co are associated (or correlated) with Induction Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Induction Healthcare has no effect on the direction of Hecla Mining i.e., Hecla Mining and Induction Healthcare go up and down completely randomly.
Pair Corralation between Hecla Mining and Induction Healthcare
Assuming the 90 days trading horizon Hecla Mining Co is expected to generate 1.65 times more return on investment than Induction Healthcare. However, Hecla Mining is 1.65 times more volatile than Induction Healthcare Group. It trades about 0.24 of its potential returns per unit of risk. Induction Healthcare Group is currently generating about -0.23 per unit of risk. If you would invest 509.00 in Hecla Mining Co on October 24, 2024 and sell it today you would earn a total of 51.00 from holding Hecla Mining Co or generate 10.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Hecla Mining Co vs. Induction Healthcare Group
Performance |
| Timeline |
| Hecla Mining |
| Induction Healthcare |
Hecla Mining and Induction Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hecla Mining and Induction Healthcare
The main advantage of trading using opposite Hecla Mining and Induction Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hecla Mining position performs unexpectedly, Induction Healthcare 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 Induction Healthcare will offset losses from the drop in Induction Healthcare's long position.| Hecla Mining vs. Induction Healthcare Group | Hecla Mining vs. Fulcrum Metals PLC | Hecla Mining vs. Sovereign Metals | Hecla Mining vs. PureTech Health plc |
| Induction Healthcare vs. Samsung Electronics Co | Induction Healthcare vs. Samsung Electronics Co | Induction Healthcare vs. Toyota Motor Corp | Induction Healthcare vs. Reliance Industries Ltd |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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