Correlation Between Auction Technology and Hochschild Mining
Can any of the company-specific risk be diversified away by investing in both Auction Technology 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 Auction Technology and Hochschild Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auction Technology Group and Hochschild Mining plc, you can compare the effects of market volatilities on Auction Technology 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 Auction Technology with a short position of Hochschild Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auction Technology and Hochschild Mining.
Diversification Opportunities for Auction Technology and Hochschild Mining
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Auction and Hochschild is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Auction Technology Group 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 Auction Technology 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 Auction Technology Group 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 Auction Technology i.e., Auction Technology and Hochschild Mining go up and down completely randomly.
Pair Corralation between Auction Technology and Hochschild Mining
Assuming the 90 days trading horizon Auction Technology Group is expected to generate 1.49 times more return on investment than Hochschild Mining. However, Auction Technology is 1.49 times more volatile than Hochschild Mining plc. It trades about 0.17 of its potential returns per unit of risk. Hochschild Mining plc is currently generating about -0.1 per unit of risk. If you would invest 45,050 in Auction Technology Group on September 1, 2024 and sell it today you would earn a total of 6,550 from holding Auction Technology Group or generate 14.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auction Technology Group vs. Hochschild Mining plc
Performance |
| Timeline |
| Auction Technology |
| Hochschild Mining plc |
Auction Technology and Hochschild Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auction Technology and Hochschild Mining
The main advantage of trading using opposite Auction Technology and Hochschild Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auction Technology 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.| Auction Technology vs. SupplyMe Capital PLC | Auction Technology vs. Lloyds Banking Group | Auction Technology vs. Premier African Minerals | Auction Technology vs. SANTANDER UK 8 |
| 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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