Correlation Between Addtech AB and Hochschild Mining
Can any of the company-specific risk be diversified away by investing in both Addtech AB 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 Addtech AB and Hochschild Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addtech AB and Hochschild Mining plc, you can compare the effects of market volatilities on Addtech AB 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 Addtech AB with a short position of Hochschild Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addtech AB and Hochschild Mining.
Diversification Opportunities for Addtech AB and Hochschild Mining
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Addtech and Hochschild is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Addtech AB 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 Addtech AB 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 Addtech AB 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 Addtech AB i.e., Addtech AB and Hochschild Mining go up and down completely randomly.
Pair Corralation between Addtech AB and Hochschild Mining
Assuming the 90 days trading horizon Addtech AB is expected to generate 0.36 times more return on investment than Hochschild Mining. However, Addtech AB is 2.81 times less risky than Hochschild Mining. It trades about 0.0 of its potential returns per unit of risk. Hochschild Mining plc is currently generating about -0.01 per unit of risk. If you would invest 2,658 in Addtech AB on October 11, 2024 and sell it today you would lose (4.00) from holding Addtech AB or give up 0.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Addtech AB vs. Hochschild Mining plc
Performance |
| Timeline |
| Addtech AB |
| Hochschild Mining plc |
Addtech AB and Hochschild Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addtech AB and Hochschild Mining
The main advantage of trading using opposite Addtech AB and Hochschild Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addtech AB 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.| Addtech AB vs. GameStop Corp | Addtech AB vs. PENN NATL GAMING | Addtech AB vs. OURGAME INTHOLDL 00005 | Addtech AB vs. QINGCI GAMES INC |
| Hochschild Mining vs. NORTHEAST UTILITIES | Hochschild Mining vs. AWILCO DRILLING PLC | Hochschild Mining vs. Addtech AB | Hochschild Mining vs. Sunny Optical Technology |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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