Correlation Between BYD and Hecla Mining
Can any of the company-specific risk be diversified away by investing in both BYD and Hecla 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 BYD and Hecla Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BYD Co and Hecla Mining Co, you can compare the effects of market volatilities on BYD and Hecla 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 BYD with a short position of Hecla Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of BYD and Hecla Mining.
Diversification Opportunities for BYD and Hecla Mining
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between BYD and Hecla is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding BYD Co and Hecla Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hecla Mining and BYD 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 BYD Co are associated (or correlated) with Hecla Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hecla Mining has no effect on the direction of BYD i.e., BYD and Hecla Mining go up and down completely randomly.
Pair Corralation between BYD and Hecla Mining
Assuming the 90 days trading horizon BYD Co is expected to generate 1.71 times more return on investment than Hecla Mining. However, BYD is 1.71 times more volatile than Hecla Mining Co. It trades about 0.06 of its potential returns per unit of risk. Hecla Mining Co is currently generating about -0.02 per unit of risk. If you would invest 3,334 in BYD Co on October 10, 2024 and sell it today you would earn a total of 226.00 from holding BYD Co or generate 6.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.56% |
| Values | Daily Returns |
BYD Co vs. Hecla Mining Co
Performance |
| Timeline |
| BYD Co |
| Hecla Mining |
BYD and Hecla Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BYD and Hecla Mining
The main advantage of trading using opposite BYD and Hecla Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BYD position performs unexpectedly, Hecla 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 Hecla Mining will offset losses from the drop in Hecla Mining's long position.| BYD vs. Panther Metals PLC | BYD vs. First Class Metals | BYD vs. CNH Industrial NV | BYD vs. Kinnevik Investment AB |
| Hecla Mining vs. Europa Metals | Hecla Mining vs. Compagnie Plastic Omnium | Hecla Mining vs. Centaur Media | Hecla Mining vs. Everyman Media Group |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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