Correlation Between Ameriwest Lithium and Metals Creek
Can any of the company-specific risk be diversified away by investing in both Ameriwest Lithium and Metals Creek 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 Ameriwest Lithium and Metals Creek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameriwest Lithium and Metals Creek Resources, you can compare the effects of market volatilities on Ameriwest Lithium and Metals Creek 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 Ameriwest Lithium with a short position of Metals Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameriwest Lithium and Metals Creek.
Diversification Opportunities for Ameriwest Lithium and Metals Creek
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ameriwest and Metals is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ameriwest Lithium and Metals Creek Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metals Creek Resources and Ameriwest Lithium 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 Ameriwest Lithium are associated (or correlated) with Metals Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metals Creek Resources has no effect on the direction of Ameriwest Lithium i.e., Ameriwest Lithium and Metals Creek go up and down completely randomly.
Pair Corralation between Ameriwest Lithium and Metals Creek
If you would invest 3.00 in Metals Creek Resources on August 29, 2024 and sell it today you would lose (1.00) from holding Metals Creek Resources or give up 33.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ameriwest Lithium vs. Metals Creek Resources
Performance |
| Timeline |
| Ameriwest Lithium |
| Metals Creek Resources |
Ameriwest Lithium and Metals Creek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ameriwest Lithium and Metals Creek
The main advantage of trading using opposite Ameriwest Lithium and Metals Creek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameriwest Lithium position performs unexpectedly, Metals Creek 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 Metals Creek will offset losses from the drop in Metals Creek's long position.| Ameriwest Lithium vs. Starr Peak Exploration | Ameriwest Lithium vs. American Lithium Corp | Ameriwest Lithium vs. Global Helium Corp | Ameriwest Lithium vs. Alpha Lithium |
| Metals Creek vs. Rockridge Resources | Metals Creek vs. Ameriwest Lithium | Metals Creek vs. Osisko Metals Incorporated | Metals Creek vs. Volt Lithium 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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