Correlation Between Hochschild Mining and TreeHouse Foods
Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and TreeHouse Foods 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 Hochschild Mining and TreeHouse Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hochschild Mining plc and TreeHouse Foods, you can compare the effects of market volatilities on Hochschild Mining and TreeHouse Foods 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 Hochschild Mining with a short position of TreeHouse Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and TreeHouse Foods.
Diversification Opportunities for Hochschild Mining and TreeHouse Foods
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hochschild and TreeHouse is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining plc and TreeHouse Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TreeHouse Foods and Hochschild Mining 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 Hochschild Mining plc are associated (or correlated) with TreeHouse Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TreeHouse Foods has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and TreeHouse Foods go up and down completely randomly.
Pair Corralation between Hochschild Mining and TreeHouse Foods
Assuming the 90 days horizon Hochschild Mining plc is expected to under-perform the TreeHouse Foods. But the stock apears to be less risky and, when comparing its historical volatility, Hochschild Mining plc is 1.19 times less risky than TreeHouse Foods. The stock trades about -0.04 of its potential returns per unit of risk. The TreeHouse Foods is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 3,480 in TreeHouse Foods on August 28, 2024 and sell it today you would lose (120.00) from holding TreeHouse Foods or give up 3.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hochschild Mining plc vs. TreeHouse Foods
Performance |
| Timeline |
| Hochschild Mining plc |
| TreeHouse Foods |
Hochschild Mining and TreeHouse Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochschild Mining and TreeHouse Foods
The main advantage of trading using opposite Hochschild Mining and TreeHouse Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, TreeHouse Foods 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 TreeHouse Foods will offset losses from the drop in TreeHouse Foods' long position.| Hochschild Mining vs. Franco Nevada | Hochschild Mining vs. Agnico Eagle Mines | Hochschild Mining vs. Superior Plus Corp | Hochschild Mining vs. NMI Holdings |
| TreeHouse Foods vs. Superior Plus Corp | TreeHouse Foods vs. NMI Holdings | TreeHouse Foods vs. Origin Agritech | TreeHouse Foods vs. SIVERS SEMICONDUCTORS AB |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |