Correlation Between Deltex Medical and Lundin Mining
Can any of the company-specific risk be diversified away by investing in both Deltex Medical and Lundin Mining 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 Deltex Medical and Lundin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deltex Medical Group and Lundin Mining Corp, you can compare the effects of market volatilities on Deltex Medical and Lundin Mining 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 Deltex Medical with a short position of Lundin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deltex Medical and Lundin Mining.
Diversification Opportunities for Deltex Medical and Lundin Mining
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Deltex and Lundin is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Deltex Medical Group and Lundin Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lundin Mining Corp and Deltex Medical 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 Deltex Medical Group are associated (or correlated) with Lundin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lundin Mining Corp has no effect on the direction of Deltex Medical i.e., Deltex Medical and Lundin Mining go up and down completely randomly.
Pair Corralation between Deltex Medical and Lundin Mining
Assuming the 90 days trading horizon Deltex Medical Group is expected to under-perform the Lundin Mining. In addition to that, Deltex Medical is 1.47 times more volatile than Lundin Mining Corp. It trades about -0.22 of its total potential returns per unit of risk. Lundin Mining Corp is currently generating about 0.06 per unit of volatility. If you would invest 10,491 in Lundin Mining Corp on September 2, 2024 and sell it today you would earn a total of 264.00 from holding Lundin Mining Corp or generate 2.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Deltex Medical Group vs. Lundin Mining Corp
Performance |
| Timeline |
| Deltex Medical Group |
| Lundin Mining Corp |
Deltex Medical and Lundin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deltex Medical and Lundin Mining
The main advantage of trading using opposite Deltex Medical and Lundin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deltex Medical position performs unexpectedly, Lundin Mining 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 Lundin Mining will offset losses from the drop in Lundin Mining's long position.| Deltex Medical vs. Samsung Electronics Co | Deltex Medical vs. Samsung Electronics Co | Deltex Medical vs. Hyundai Motor | Deltex Medical vs. Toyota Motor Corp |
| Lundin Mining vs. Supermarket Income REIT | Lundin Mining vs. Ecclesiastical Insurance Office | Lundin Mining vs. Batm Advanced Communications | Lundin Mining vs. Team Internet Group |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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