Correlation Between Boat Rocker and LithiumBank Resources
Can any of the company-specific risk be diversified away by investing in both Boat Rocker and LithiumBank 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 Boat Rocker and LithiumBank Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boat Rocker Media and LithiumBank Resources Corp, you can compare the effects of market volatilities on Boat Rocker and LithiumBank 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 Boat Rocker with a short position of LithiumBank Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boat Rocker and LithiumBank Resources.
Diversification Opportunities for Boat Rocker and LithiumBank Resources
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Boat and LithiumBank is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Boat Rocker Media and LithiumBank Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LithiumBank Resources and Boat Rocker 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 Boat Rocker Media are associated (or correlated) with LithiumBank Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LithiumBank Resources has no effect on the direction of Boat Rocker i.e., Boat Rocker and LithiumBank Resources go up and down completely randomly.
Pair Corralation between Boat Rocker and LithiumBank Resources
Assuming the 90 days trading horizon Boat Rocker is expected to generate 2.4 times less return on investment than LithiumBank Resources. But when comparing it to its historical volatility, Boat Rocker Media is 1.03 times less risky than LithiumBank Resources. It trades about 0.01 of its potential returns per unit of risk. LithiumBank Resources Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 28.00 in LithiumBank Resources Corp on September 14, 2024 and sell it today you would earn a total of 0.00 from holding LithiumBank Resources Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boat Rocker Media vs. LithiumBank Resources Corp
Performance |
| Timeline |
| Boat Rocker Media |
| LithiumBank Resources |
Boat Rocker and LithiumBank Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boat Rocker and LithiumBank Resources
The main advantage of trading using opposite Boat Rocker and LithiumBank Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boat Rocker position performs unexpectedly, LithiumBank 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 LithiumBank Resources will offset losses from the drop in LithiumBank Resources' long position.| Boat Rocker vs. Royal Helium | Boat Rocker vs. Excelsior Mining Corp | Boat Rocker vs. Vista Gold | Boat Rocker vs. Intermap Technologies 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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