Correlation Between American Lithium and ZincX Resources
Can any of the company-specific risk be diversified away by investing in both American Lithium and ZincX Resources 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 American Lithium and ZincX Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Lithium Minerals and ZincX Resources Corp, you can compare the effects of market volatilities on American Lithium and ZincX Resources 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 American Lithium with a short position of ZincX Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Lithium and ZincX Resources.
Diversification Opportunities for American Lithium and ZincX Resources
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between American and ZincX is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding American Lithium Minerals and ZincX Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZincX Resources Corp and American Lithium 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 American Lithium Minerals are associated (or correlated) with ZincX Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZincX Resources Corp has no effect on the direction of American Lithium i.e., American Lithium and ZincX Resources go up and down completely randomly.
Pair Corralation between American Lithium and ZincX Resources
Given the investment horizon of 90 days American Lithium Minerals is expected to generate 1.49 times more return on investment than ZincX Resources. However, American Lithium is 1.49 times more volatile than ZincX Resources Corp. It trades about 0.3 of its potential returns per unit of risk. ZincX Resources Corp is currently generating about 0.23 per unit of risk. If you would invest 2.00 in American Lithium Minerals on November 5, 2024 and sell it today you would earn a total of 1.93 from holding American Lithium Minerals or generate 96.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
American Lithium Minerals vs. ZincX Resources Corp
Performance |
| Timeline |
| American Lithium Minerals |
| ZincX Resources Corp |
American Lithium and ZincX Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Lithium and ZincX Resources
The main advantage of trading using opposite American Lithium and ZincX Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Lithium position performs unexpectedly, ZincX Resources 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 ZincX Resources will offset losses from the drop in ZincX Resources' long position.| American Lithium vs. Artemis Resources | American Lithium vs. St Georges Eco Mining Corp | American Lithium vs. Atco Mining | American Lithium vs. Avarone Metals |
| ZincX Resources vs. Rokmaster Resources Corp | ZincX Resources vs. Tartisan Nickel Corp | ZincX Resources vs. VR Resources | ZincX Resources vs. Getchell Gold Corp |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |