Correlation Between Antofagasta PLC and Hochschild Mining
Can any of the company-specific risk be diversified away by investing in both Antofagasta PLC and Hochschild 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 Antofagasta PLC and Hochschild Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Antofagasta PLC and Hochschild Mining plc, you can compare the effects of market volatilities on Antofagasta PLC and Hochschild 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 Antofagasta PLC with a short position of Hochschild Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Antofagasta PLC and Hochschild Mining.
Diversification Opportunities for Antofagasta PLC and Hochschild Mining
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Antofagasta and Hochschild is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Antofagasta PLC and Hochschild Mining plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hochschild Mining plc and Antofagasta PLC 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 Antofagasta PLC are associated (or correlated) with Hochschild Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hochschild Mining plc has no effect on the direction of Antofagasta PLC i.e., Antofagasta PLC and Hochschild Mining go up and down completely randomly.
Pair Corralation between Antofagasta PLC and Hochschild Mining
Assuming the 90 days trading horizon Antofagasta PLC is expected to generate 3.68 times less return on investment than Hochschild Mining. But when comparing it to its historical volatility, Antofagasta PLC is 1.31 times less risky than Hochschild Mining. It trades about 0.04 of its potential returns per unit of risk. Hochschild Mining plc is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 11,000 in Hochschild Mining plc on August 25, 2024 and sell it today you would earn a total of 11,400 from holding Hochschild Mining plc or generate 103.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Antofagasta PLC vs. Hochschild Mining plc
Performance |
| Timeline |
| Antofagasta PLC |
| Hochschild Mining plc |
Antofagasta PLC and Hochschild Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Antofagasta PLC and Hochschild Mining
The main advantage of trading using opposite Antofagasta PLC and Hochschild Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Antofagasta PLC position performs unexpectedly, Hochschild 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 Hochschild Mining will offset losses from the drop in Hochschild Mining's long position.| Antofagasta PLC vs. Optima Health plc | Antofagasta PLC vs. Tatton Asset Management | Antofagasta PLC vs. Direct Line Insurance | Antofagasta PLC vs. Eco Animal Health |
| Hochschild Mining vs. Givaudan SA | Hochschild Mining vs. Antofagasta PLC | Hochschild Mining vs. Centamin PLC | Hochschild Mining vs. Atalaya Mining |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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