Correlation Between Ferrexpo PLC and Eastinco Mining
Can any of the company-specific risk be diversified away by investing in both Ferrexpo PLC and Eastinco 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 Ferrexpo PLC and Eastinco Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ferrexpo PLC and Eastinco Mining Exploration, you can compare the effects of market volatilities on Ferrexpo PLC and Eastinco 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 Ferrexpo PLC with a short position of Eastinco Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ferrexpo PLC and Eastinco Mining.
Diversification Opportunities for Ferrexpo PLC and Eastinco Mining
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ferrexpo and Eastinco is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Ferrexpo PLC and Eastinco Mining Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastinco Mining Expl and Ferrexpo PLC 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 Ferrexpo PLC are associated (or correlated) with Eastinco Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastinco Mining Expl has no effect on the direction of Ferrexpo PLC i.e., Ferrexpo PLC and Eastinco Mining go up and down completely randomly.
Pair Corralation between Ferrexpo PLC and Eastinco Mining
Assuming the 90 days trading horizon Ferrexpo PLC is expected to generate 3895.45 times less return on investment than Eastinco Mining. But when comparing it to its historical volatility, Ferrexpo PLC is 66.9 times less risky than Eastinco Mining. It trades about 0.0 of its potential returns per unit of risk. Eastinco Mining Exploration is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 0.83 in Eastinco Mining Exploration on October 23, 2024 and sell it today you would earn a total of 5,349 from holding Eastinco Mining Exploration or generate 644478.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.39% |
| Values | Daily Returns |
Ferrexpo PLC vs. Eastinco Mining Exploration
Performance |
| Timeline |
| Ferrexpo PLC |
| Eastinco Mining Expl |
Ferrexpo PLC and Eastinco Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ferrexpo PLC and Eastinco Mining
The main advantage of trading using opposite Ferrexpo PLC and Eastinco Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ferrexpo PLC position performs unexpectedly, Eastinco 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 Eastinco Mining will offset losses from the drop in Eastinco Mining's long position.| Ferrexpo PLC vs. Medical Properties Trust | Ferrexpo PLC vs. Coeur Mining | Ferrexpo PLC vs. Silver Bullet Data | Ferrexpo PLC vs. CleanTech Lithium plc |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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