Correlation Between Lundin Mining and Ikigai Ventures
Can any of the company-specific risk be diversified away by investing in both Lundin Mining and Ikigai Ventures 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 Ikigai Ventures 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 Ikigai Ventures, you can compare the effects of market volatilities on Lundin Mining and Ikigai Ventures 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 Ikigai Ventures. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Mining and Ikigai Ventures.
Diversification Opportunities for Lundin Mining and Ikigai Ventures
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lundin and Ikigai is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Mining Corp and Ikigai Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ikigai Ventures 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 Ikigai Ventures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ikigai Ventures has no effect on the direction of Lundin Mining i.e., Lundin Mining and Ikigai Ventures go up and down completely randomly.
Pair Corralation between Lundin Mining and Ikigai Ventures
Assuming the 90 days trading horizon Lundin Mining Corp is expected to under-perform the Ikigai Ventures. In addition to that, Lundin Mining is 5.74 times more volatile than Ikigai Ventures. It trades about -0.09 of its total potential returns per unit of risk. Ikigai Ventures is currently generating about -0.13 per unit of volatility. If you would invest 4,650 in Ikigai Ventures on October 25, 2024 and sell it today you would lose (150.00) from holding Ikigai Ventures or give up 3.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lundin Mining Corp vs. Ikigai Ventures
Performance |
| Timeline |
| Lundin Mining Corp |
| Ikigai Ventures |
Lundin Mining and Ikigai Ventures Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Mining and Ikigai Ventures
The main advantage of trading using opposite Lundin Mining and Ikigai Ventures positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Mining position performs unexpectedly, Ikigai Ventures 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 Ikigai Ventures will offset losses from the drop in Ikigai Ventures' long position.| Lundin Mining vs. Edita Food Industries | Lundin Mining vs. Baker Steel Resources | Lundin Mining vs. Grieg Seafood | Lundin Mining vs. Monster Beverage Corp |
| Ikigai Ventures vs. Verizon Communications | Ikigai Ventures vs. Mobile Tornado Group | Ikigai Ventures vs. Universal Health Services | Ikigai Ventures vs. Molson Coors Beverage |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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