Correlation Between Altair International and Lomiko Metals
Can any of the company-specific risk be diversified away by investing in both Altair International and Lomiko Metals 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 Altair International and Lomiko Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altair International Corp and Lomiko Metals, you can compare the effects of market volatilities on Altair International and Lomiko Metals 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 Altair International with a short position of Lomiko Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altair International and Lomiko Metals.
Diversification Opportunities for Altair International and Lomiko Metals
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Altair and Lomiko is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Altair International Corp and Lomiko Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lomiko Metals and Altair International 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 Altair International Corp are associated (or correlated) with Lomiko Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lomiko Metals has no effect on the direction of Altair International i.e., Altair International and Lomiko Metals go up and down completely randomly.
Pair Corralation between Altair International and Lomiko Metals
Given the investment horizon of 90 days Altair International is expected to generate 31.98 times less return on investment than Lomiko Metals. But when comparing it to its historical volatility, Altair International Corp is 10.11 times less risky than Lomiko Metals. It trades about 0.06 of its potential returns per unit of risk. Lomiko Metals is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 20.00 in Lomiko Metals on September 3, 2024 and sell it today you would lose (10.80) from holding Lomiko Metals or give up 54.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altair International Corp vs. Lomiko Metals
Performance |
| Timeline |
| Altair International Corp |
| Lomiko Metals |
Altair International and Lomiko Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altair International and Lomiko Metals
The main advantage of trading using opposite Altair International and Lomiko Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altair International position performs unexpectedly, Lomiko Metals 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 Lomiko Metals will offset losses from the drop in Lomiko Metals' long position.| Altair International vs. Qubec Nickel Corp | Altair International vs. IGO Limited | Altair International vs. Avarone Metals | Altair International vs. Adriatic Metals PLC |
| Lomiko Metals vs. ZincX Resources Corp | Lomiko Metals vs. Mundoro Capital | Lomiko Metals vs. Strategic Resources | Lomiko Metals vs. Norra Metals 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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