Correlation Between Boliden AB and Iluka Resources
Can any of the company-specific risk be diversified away by investing in both Boliden AB and Iluka Resources 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 Iluka Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boliden AB and Iluka Resources Ltd, you can compare the effects of market volatilities on Boliden AB and Iluka Resources 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 Iluka Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boliden AB and Iluka Resources.
Diversification Opportunities for Boliden AB and Iluka Resources
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Boliden and Iluka is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Boliden AB and Iluka Resources Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iluka Resources 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 Iluka Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iluka Resources has no effect on the direction of Boliden AB i.e., Boliden AB and Iluka Resources go up and down completely randomly.
Pair Corralation between Boliden AB and Iluka Resources
If you would invest 3,465 in Boliden AB on September 24, 2024 and sell it today you would earn a total of 0.00 from holding Boliden AB or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
Boliden AB vs. Iluka Resources Ltd
Performance |
| Timeline |
| Boliden AB |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Iluka Resources |
Boliden AB and Iluka Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boliden AB and Iluka Resources
The main advantage of trading using opposite Boliden AB and Iluka Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boliden AB position performs unexpectedly, Iluka Resources 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 Iluka Resources will offset losses from the drop in Iluka Resources' long position.| Boliden AB vs. Avarone Metals | Boliden AB vs. Aurelia Metals Limited | Boliden AB vs. Adriatic Metals PLC | Boliden AB vs. Huntsman Exploration |
| Iluka Resources vs. Altair International Corp | Iluka Resources vs. Global Battery Metals | Iluka Resources vs. Jourdan Resources | Iluka Resources vs. Lomiko Metals |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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