Correlation Between BAIYU Holdings and Lifezone Metals
Can any of the company-specific risk be diversified away by investing in both BAIYU Holdings and Lifezone 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 BAIYU Holdings and Lifezone Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BAIYU Holdings and Lifezone Metals Limited, you can compare the effects of market volatilities on BAIYU Holdings and Lifezone 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 BAIYU Holdings with a short position of Lifezone Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of BAIYU Holdings and Lifezone Metals.
Diversification Opportunities for BAIYU Holdings and Lifezone Metals
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BAIYU and Lifezone is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding BAIYU Holdings and Lifezone Metals Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifezone Metals and BAIYU Holdings 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 BAIYU Holdings are associated (or correlated) with Lifezone Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifezone Metals has no effect on the direction of BAIYU Holdings i.e., BAIYU Holdings and Lifezone Metals go up and down completely randomly.
Pair Corralation between BAIYU Holdings and Lifezone Metals
Considering the 90-day investment horizon BAIYU Holdings is expected to under-perform the Lifezone Metals. In addition to that, BAIYU Holdings is 1.72 times more volatile than Lifezone Metals Limited. It trades about -0.08 of its total potential returns per unit of risk. Lifezone Metals Limited is currently generating about 0.01 per unit of volatility. If you would invest 1,030 in Lifezone Metals Limited on August 30, 2024 and sell it today you would lose (335.00) from holding Lifezone Metals Limited or give up 32.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.99% |
| Values | Daily Returns |
BAIYU Holdings vs. Lifezone Metals Limited
Performance |
| Timeline |
| BAIYU Holdings |
| Lifezone Metals |
BAIYU Holdings and Lifezone Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BAIYU Holdings and Lifezone Metals
The main advantage of trading using opposite BAIYU Holdings and Lifezone Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BAIYU Holdings position performs unexpectedly, Lifezone 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 Lifezone Metals will offset losses from the drop in Lifezone Metals' long position.| BAIYU Holdings vs. Western Digital | BAIYU Holdings vs. Viemed Healthcare | BAIYU Holdings vs. Meiwu Technology Co | BAIYU Holdings vs. Centessa Pharmaceuticals PLC |
| Lifezone Metals vs. Suntory Beverage Food | Lifezone Metals vs. Aspen Insurance Holdings | Lifezone Metals vs. Primerica | Lifezone Metals vs. Ambev SA ADR |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |