Correlation Between Huntsman Exploration and American Helium
Can any of the company-specific risk be diversified away by investing in both Huntsman Exploration and American Helium 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 Huntsman Exploration and American Helium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huntsman Exploration and American Helium, you can compare the effects of market volatilities on Huntsman Exploration and American Helium 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 Huntsman Exploration with a short position of American Helium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huntsman Exploration and American Helium.
Diversification Opportunities for Huntsman Exploration and American Helium
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Huntsman and American is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Huntsman Exploration and American Helium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Helium and Huntsman Exploration 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 Huntsman Exploration are associated (or correlated) with American Helium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Helium has no effect on the direction of Huntsman Exploration i.e., Huntsman Exploration and American Helium go up and down completely randomly.
Pair Corralation between Huntsman Exploration and American Helium
Assuming the 90 days horizon Huntsman Exploration is expected to under-perform the American Helium. In addition to that, Huntsman Exploration is 5.98 times more volatile than American Helium. It trades about -0.21 of its total potential returns per unit of risk. American Helium is currently generating about 0.21 per unit of volatility. If you would invest 10.00 in American Helium on August 24, 2024 and sell it today you would earn a total of 1.00 from holding American Helium or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huntsman Exploration vs. American Helium
Performance |
| Timeline |
| Huntsman Exploration |
| American Helium |
Huntsman Exploration and American Helium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huntsman Exploration and American Helium
The main advantage of trading using opposite Huntsman Exploration and American Helium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huntsman Exploration position performs unexpectedly, American Helium 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 American Helium will offset losses from the drop in American Helium's long position.| Huntsman Exploration vs. Aurelia Metals Limited | Huntsman Exploration vs. Adriatic Metals PLC | Huntsman Exploration vs. American Helium | Huntsman Exploration vs. Progressive Planet Solutions |
| American Helium vs. Norra Metals Corp | American Helium vs. Amarc Resources | American Helium vs. ZincX Resources Corp | American Helium vs. Nuinsco Resources Limited |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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