Correlation Between Lundin Mining and Invesco Physical
Can any of the company-specific risk be diversified away by investing in both Lundin Mining and Invesco Physical 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 Invesco Physical 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 Invesco Physical Silver, you can compare the effects of market volatilities on Lundin Mining and Invesco Physical 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 Invesco Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Mining and Invesco Physical.
Diversification Opportunities for Lundin Mining and Invesco Physical
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lundin and Invesco is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Mining Corp and Invesco Physical Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Physical Silver 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 Invesco Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Physical Silver has no effect on the direction of Lundin Mining i.e., Lundin Mining and Invesco Physical go up and down completely randomly.
Pair Corralation between Lundin Mining and Invesco Physical
Assuming the 90 days trading horizon Lundin Mining Corp is expected to generate 1.56 times more return on investment than Invesco Physical. However, Lundin Mining is 1.56 times more volatile than Invesco Physical Silver. It trades about 0.05 of its potential returns per unit of risk. Invesco Physical Silver is currently generating about 0.03 per unit of risk. If you would invest 10,323 in Lundin Mining Corp on August 28, 2024 and sell it today you would earn a total of 627.00 from holding Lundin Mining Corp or generate 6.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lundin Mining Corp vs. Invesco Physical Silver
Performance |
| Timeline |
| Lundin Mining Corp |
| Invesco Physical Silver |
Lundin Mining and Invesco Physical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Mining and Invesco Physical
The main advantage of trading using opposite Lundin Mining and Invesco Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Mining position performs unexpectedly, Invesco Physical 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 Invesco Physical will offset losses from the drop in Invesco Physical's long position.| Lundin Mining vs. Samsung Electronics Co | Lundin Mining vs. Samsung Electronics Co | Lundin Mining vs. Hyundai Motor | Lundin Mining vs. Toyota Motor Corp |
| Invesco Physical vs. Playtech Plc | Invesco Physical vs. Microchip Technology | Invesco Physical vs. Made Tech Group | Invesco Physical vs. Albion Technology General |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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