Correlation Between Lundin Mining and Spire Healthcare
Can any of the company-specific risk be diversified away by investing in both Lundin Mining and Spire 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 Lundin Mining and Spire Healthcare 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 Spire Healthcare Group, you can compare the effects of market volatilities on Lundin Mining and Spire 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 Lundin Mining with a short position of Spire Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Mining and Spire Healthcare.
Diversification Opportunities for Lundin Mining and Spire Healthcare
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lundin and Spire is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Mining Corp and Spire Healthcare Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spire Healthcare 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 Spire Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spire Healthcare has no effect on the direction of Lundin Mining i.e., Lundin Mining and Spire Healthcare go up and down completely randomly.
Pair Corralation between Lundin Mining and Spire Healthcare
Assuming the 90 days trading horizon Lundin Mining Corp is expected to under-perform the Spire Healthcare. In addition to that, Lundin Mining is 1.77 times more volatile than Spire Healthcare Group. It trades about -0.01 of its total potential returns per unit of risk. Spire Healthcare Group is currently generating about 0.14 per unit of volatility. If you would invest 22,800 in Spire Healthcare Group on October 17, 2024 and sell it today you would earn a total of 900.00 from holding Spire Healthcare Group or generate 3.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lundin Mining Corp vs. Spire Healthcare Group
Performance |
| Timeline |
| Lundin Mining Corp |
| Spire Healthcare |
Lundin Mining and Spire Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Mining and Spire Healthcare
The main advantage of trading using opposite Lundin Mining and Spire Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Mining position performs unexpectedly, Spire 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 Spire Healthcare will offset losses from the drop in Spire Healthcare's long position.| Lundin Mining vs. Air Products Chemicals | Lundin Mining vs. Broadridge Financial Solutions | Lundin Mining vs. Golden Metal Resources | Lundin Mining vs. Europa Metals |
| Spire Healthcare vs. Vienna Insurance Group | Spire Healthcare vs. Wheaton Precious Metals | Spire Healthcare vs. Lundin Mining Corp | Spire Healthcare vs. Grieg Seafood |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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