Correlation Between Dairy Farm and Lundin Mining
Can any of the company-specific risk be diversified away by investing in both Dairy Farm 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 Dairy Farm and Lundin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dairy Farm International and Lundin Mining Corp, you can compare the effects of market volatilities on Dairy Farm 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 Dairy Farm with a short position of Lundin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dairy Farm and Lundin Mining.
Diversification Opportunities for Dairy Farm and Lundin Mining
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dairy and Lundin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Dairy Farm International 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 Dairy Farm 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 Dairy Farm International 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 Dairy Farm i.e., Dairy Farm and Lundin Mining go up and down completely randomly.
Pair Corralation between Dairy Farm and Lundin Mining
If you would invest 7,926 in Lundin Mining Corp on November 9, 2024 and sell it today you would earn a total of 1,262 from holding Lundin Mining Corp or generate 15.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dairy Farm International vs. Lundin Mining Corp
Performance |
| Timeline |
| Dairy Farm International |
| Lundin Mining Corp |
Dairy Farm and Lundin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dairy Farm and Lundin Mining
The main advantage of trading using opposite Dairy Farm and Lundin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dairy Farm 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.| Dairy Farm vs. Universal Health Services | Dairy Farm vs. Abingdon Health Plc | Dairy Farm vs. Solstad Offshore ASA | Dairy Farm vs. PureTech Health plc |
| Lundin Mining vs. SMA Solar Technology | Lundin Mining vs. Clean Power Hydrogen | Lundin Mining vs. Ashtead Technology Holdings | Lundin Mining vs. Software Circle plc |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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