Correlation Between Energy Technologies and Lithium Australia
Can any of the company-specific risk be diversified away by investing in both Energy Technologies and Lithium Australia 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 Energy Technologies and Lithium Australia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energy Technologies Limited and Lithium Australia NL, you can compare the effects of market volatilities on Energy Technologies and Lithium Australia 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 Energy Technologies with a short position of Lithium Australia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energy Technologies and Lithium Australia.
Diversification Opportunities for Energy Technologies and Lithium Australia
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Energy and Lithium is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Energy Technologies Limited and Lithium Australia NL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lithium Australia and Energy Technologies 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 Energy Technologies Limited are associated (or correlated) with Lithium Australia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lithium Australia has no effect on the direction of Energy Technologies i.e., Energy Technologies and Lithium Australia go up and down completely randomly.
Pair Corralation between Energy Technologies and Lithium Australia
If you would invest 3.00 in Energy Technologies Limited on September 12, 2024 and sell it today you would earn a total of 0.10 from holding Energy Technologies Limited or generate 3.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Energy Technologies Limited vs. Lithium Australia NL
Performance |
| Timeline |
| Energy Technologies |
| Lithium Australia |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Energy Technologies and Lithium Australia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energy Technologies and Lithium Australia
The main advantage of trading using opposite Energy Technologies and Lithium Australia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energy Technologies position performs unexpectedly, Lithium Australia 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 Lithium Australia will offset losses from the drop in Lithium Australia's long position.| Energy Technologies vs. Aneka Tambang Tbk | Energy Technologies vs. Commonwealth Bank of | Energy Technologies vs. ANZ Group Holdings | Energy Technologies vs. National Australia Bank |
| Lithium Australia vs. Australian Strategic Materials | Lithium Australia vs. Dalaroo Metals | Lithium Australia vs. MetalsGrove Mining | Lithium Australia vs. Carawine Resources Limited |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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