Correlation Between American Manganese and Lion One
Can any of the company-specific risk be diversified away by investing in both American Manganese and Lion One 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 Manganese and Lion One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Manganese and Lion One Metals, you can compare the effects of market volatilities on American Manganese and Lion One 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 Manganese with a short position of Lion One. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Manganese and Lion One.
Diversification Opportunities for American Manganese and Lion One
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between American and Lion is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding American Manganese and Lion One Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion One Metals and American Manganese 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 Manganese are associated (or correlated) with Lion One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion One Metals has no effect on the direction of American Manganese i.e., American Manganese and Lion One go up and down completely randomly.
Pair Corralation between American Manganese and Lion One
Assuming the 90 days horizon American Manganese is expected to generate 1.81 times more return on investment than Lion One. However, American Manganese is 1.81 times more volatile than Lion One Metals. It trades about -0.01 of its potential returns per unit of risk. Lion One Metals is currently generating about -0.09 per unit of risk. If you would invest 26.00 in American Manganese on September 4, 2024 and sell it today you would lose (15.00) from holding American Manganese or give up 57.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Manganese vs. Lion One Metals
Performance |
| Timeline |
| American Manganese |
| Lion One Metals |
American Manganese and Lion One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Manganese and Lion One
The main advantage of trading using opposite American Manganese and Lion One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Manganese position performs unexpectedly, Lion One 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 Lion One will offset losses from the drop in Lion One's long position.| American Manganese vs. Manganese X Energy | American Manganese vs. Frontier Lithium | American Manganese vs. Talon Metals Corp | American Manganese vs. Azincourt Uranium |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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