Correlation Between AXMIN and LODESTAR MIN
Can any of the company-specific risk be diversified away by investing in both AXMIN and LODESTAR MIN 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 AXMIN and LODESTAR MIN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AXMIN Inc and LODESTAR MIN, you can compare the effects of market volatilities on AXMIN and LODESTAR MIN 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 AXMIN with a short position of LODESTAR MIN. Check out your portfolio center. Please also check ongoing floating volatility patterns of AXMIN and LODESTAR MIN.
Diversification Opportunities for AXMIN and LODESTAR MIN
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between AXMIN and LODESTAR is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding AXMIN Inc and LODESTAR MIN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LODESTAR MIN and AXMIN 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 AXMIN Inc are associated (or correlated) with LODESTAR MIN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LODESTAR MIN has no effect on the direction of AXMIN i.e., AXMIN and LODESTAR MIN go up and down completely randomly.
Pair Corralation between AXMIN and LODESTAR MIN
If you would invest 0.44 in LODESTAR MIN on September 3, 2024 and sell it today you would earn a total of 0.00 from holding LODESTAR MIN or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
AXMIN Inc vs. LODESTAR MIN
Performance |
| Timeline |
| AXMIN Inc |
| LODESTAR MIN |
AXMIN and LODESTAR MIN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AXMIN and LODESTAR MIN
The main advantage of trading using opposite AXMIN and LODESTAR MIN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AXMIN position performs unexpectedly, LODESTAR MIN 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 LODESTAR MIN will offset losses from the drop in LODESTAR MIN's long position.| AXMIN vs. Canadian Utilities Limited | AXMIN vs. National Bank Holdings | AXMIN vs. PT Bank Maybank | AXMIN vs. Webster Financial |
| LODESTAR MIN vs. ELMOS SEMICONDUCTOR | LODESTAR MIN vs. Magnachip Semiconductor | LODESTAR MIN vs. Ameriprise Financial | LODESTAR MIN vs. Taiwan Semiconductor Manufacturing |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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