Correlation Between Boliden AB and Adriatic Metals
Can any of the company-specific risk be diversified away by investing in both Boliden AB and Adriatic 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 Boliden AB and Adriatic Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boliden AB and Adriatic Metals PLC, you can compare the effects of market volatilities on Boliden AB and Adriatic 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 Boliden AB with a short position of Adriatic Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boliden AB and Adriatic Metals.
Diversification Opportunities for Boliden AB and Adriatic Metals
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Boliden and Adriatic is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Boliden AB and Adriatic Metals PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adriatic Metals PLC and Boliden 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 Boliden AB are associated (or correlated) with Adriatic Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adriatic Metals PLC has no effect on the direction of Boliden AB i.e., Boliden AB and Adriatic Metals go up and down completely randomly.
Pair Corralation between Boliden AB and Adriatic Metals
If you would invest 246.00 in Adriatic Metals PLC on September 20, 2024 and sell it today you would earn a total of 7.00 from holding Adriatic Metals PLC or generate 2.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 1.56% |
| Values | Daily Returns |
Boliden AB vs. Adriatic Metals PLC
Performance |
| Timeline |
| Boliden AB |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Adriatic Metals PLC |
Boliden AB and Adriatic Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boliden AB and Adriatic Metals
The main advantage of trading using opposite Boliden AB and Adriatic Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boliden AB position performs unexpectedly, Adriatic 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 Adriatic Metals will offset losses from the drop in Adriatic Metals' long position.| Boliden AB vs. Avarone Metals | Boliden AB vs. Aurelia Metals Limited | Boliden AB vs. Adriatic Metals PLC | Boliden AB vs. Huntsman Exploration |
| Adriatic Metals vs. Huntsman Exploration | Adriatic Metals vs. Aurelia Metals Limited | Adriatic Metals vs. American Helium | Adriatic Metals vs. Progressive Planet Solutions |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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