Correlation Between Alien Metals and Hecla Mining
Can any of the company-specific risk be diversified away by investing in both Alien Metals 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 Alien Metals and Hecla Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alien Metals and Hecla Mining, you can compare the effects of market volatilities on Alien Metals 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 Alien Metals with a short position of Hecla Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alien Metals and Hecla Mining.
Diversification Opportunities for Alien Metals and Hecla Mining
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Alien and Hecla is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Alien Metals and Hecla Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hecla Mining and Alien Metals 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 Alien Metals 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 Alien Metals i.e., Alien Metals and Hecla Mining go up and down completely randomly.
Pair Corralation between Alien Metals and Hecla Mining
Assuming the 90 days horizon Alien Metals is expected to generate 28.08 times more return on investment than Hecla Mining. However, Alien Metals is 28.08 times more volatile than Hecla Mining. It trades about 0.14 of its potential returns per unit of risk. Hecla Mining is currently generating about -0.16 per unit of risk. If you would invest 0.22 in Alien Metals on September 4, 2024 and sell it today you would lose (0.10) from holding Alien Metals or give up 45.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Alien Metals vs. Hecla Mining
Performance |
| Timeline |
| Alien Metals |
| Hecla Mining |
Alien Metals and Hecla Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alien Metals and Hecla Mining
The main advantage of trading using opposite Alien Metals and Hecla Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alien Metals 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.| Alien Metals vs. Cartier Iron Corp | Alien Metals vs. Arctic Star Exploration | Alien Metals vs. Denarius Silver Corp | Alien Metals vs. Pacific Ridge Exploration |
| Hecla Mining vs. SilverCrest Metals | Hecla Mining vs. McEwen Mining | Hecla Mining vs. Avino Silver Gold | Hecla Mining vs. Metalla Royalty Streaming |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |