Correlation Between Lundin Mining and Cairo Communication
Can any of the company-specific risk be diversified away by investing in both Lundin Mining and Cairo Communication 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 Lundin Mining and Cairo Communication into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lundin Mining Corp and Cairo Communication SpA, you can compare the effects of market volatilities on Lundin Mining and Cairo Communication 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 Lundin Mining with a short position of Cairo Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Mining and Cairo Communication.
Diversification Opportunities for Lundin Mining and Cairo Communication
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lundin and Cairo is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Mining Corp and Cairo Communication SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cairo Communication SpA and Lundin 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 Lundin Mining Corp are associated (or correlated) with Cairo Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cairo Communication SpA has no effect on the direction of Lundin Mining i.e., Lundin Mining and Cairo Communication go up and down completely randomly.
Pair Corralation between Lundin Mining and Cairo Communication
Assuming the 90 days trading horizon Lundin Mining is expected to generate 2.9 times less return on investment than Cairo Communication. In addition to that, Lundin Mining is 1.43 times more volatile than Cairo Communication SpA. It trades about 0.02 of its total potential returns per unit of risk. Cairo Communication SpA is currently generating about 0.1 per unit of volatility. If you would invest 165.00 in Cairo Communication SpA on November 3, 2024 and sell it today you would earn a total of 89.00 from holding Cairo Communication SpA or generate 53.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lundin Mining Corp vs. Cairo Communication SpA
Performance |
| Timeline |
| Lundin Mining Corp |
| Cairo Communication SpA |
Lundin Mining and Cairo Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Mining and Cairo Communication
The main advantage of trading using opposite Lundin Mining and Cairo Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Mining position performs unexpectedly, Cairo Communication 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 Cairo Communication will offset losses from the drop in Cairo Communication's long position.| Lundin Mining vs. Bankers Investment Trust | Lundin Mining vs. Metro Bank PLC | Lundin Mining vs. Southwest Airlines Co | Lundin Mining vs. McEwen Mining |
| Cairo Communication vs. Golden Metal Resources | Cairo Communication vs. Trainline Plc | Cairo Communication vs. United Utilities Group | Cairo Communication vs. Darden Restaurants |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |