Correlation Between Lundin Mining and Eastinco Mining
Can any of the company-specific risk be diversified away by investing in both Lundin Mining and Eastinco 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 Lundin Mining and Eastinco Mining 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 Eastinco Mining Exploration, you can compare the effects of market volatilities on Lundin Mining and Eastinco 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 Lundin Mining with a short position of Eastinco Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Mining and Eastinco Mining.
Diversification Opportunities for Lundin Mining and Eastinco Mining
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lundin and Eastinco is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Mining Corp and Eastinco Mining Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastinco Mining Expl 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 Eastinco Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastinco Mining Expl has no effect on the direction of Lundin Mining i.e., Lundin Mining and Eastinco Mining go up and down completely randomly.
Pair Corralation between Lundin Mining and Eastinco Mining
Assuming the 90 days trading horizon Lundin Mining is expected to generate 690.47 times less return on investment than Eastinco Mining. But when comparing it to its historical volatility, Lundin Mining Corp is 105.99 times less risky than Eastinco Mining. It trades about 0.04 of its potential returns per unit of risk. Eastinco Mining Exploration is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 0.83 in Eastinco Mining Exploration on November 2, 2024 and sell it today you would earn a total of 5,099 from holding Eastinco Mining Exploration or generate 614357.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.2% |
| Values | Daily Returns |
Lundin Mining Corp vs. Eastinco Mining Exploration
Performance |
| Timeline |
| Lundin Mining Corp |
| Eastinco Mining Expl |
Lundin Mining and Eastinco Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Mining and Eastinco Mining
The main advantage of trading using opposite Lundin Mining and Eastinco Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Mining position performs unexpectedly, Eastinco 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 Eastinco Mining will offset losses from the drop in Eastinco Mining's long position.| Lundin Mining vs. Taiwan Semiconductor Manufacturing | Lundin Mining vs. Liontrust Asset Management | Lundin Mining vs. G5 Entertainment AB | Lundin Mining vs. Jupiter Fund Management |
| Eastinco Mining vs. Adriatic Metals | Eastinco Mining vs. MediaZest plc | Eastinco Mining vs. Rheinmetall AG | Eastinco Mining vs. Wheaton Precious Metals |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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