Correlation Between Hochschild Mining and GELSENWASSER
Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and GELSENWASSER 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 GELSENWASSER 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 GELSENWASSER, you can compare the effects of market volatilities on Hochschild Mining and GELSENWASSER 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 GELSENWASSER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and GELSENWASSER.
Diversification Opportunities for Hochschild Mining and GELSENWASSER
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hochschild and GELSENWASSER is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining plc and GELSENWASSER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GELSENWASSER 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 GELSENWASSER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GELSENWASSER has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and GELSENWASSER go up and down completely randomly.
Pair Corralation between Hochschild Mining and GELSENWASSER
Assuming the 90 days horizon Hochschild Mining plc is expected to under-perform the GELSENWASSER. In addition to that, Hochschild Mining is 2.2 times more volatile than GELSENWASSER. It trades about -0.04 of its total potential returns per unit of risk. GELSENWASSER is currently generating about 0.01 per unit of volatility. If you would invest 50,000 in GELSENWASSER on September 2, 2024 and sell it today you would earn a total of 0.00 from holding GELSENWASSER or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hochschild Mining plc vs. GELSENWASSER
Performance |
| Timeline |
| Hochschild Mining plc |
| GELSENWASSER |
Hochschild Mining and GELSENWASSER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochschild Mining and GELSENWASSER
The main advantage of trading using opposite Hochschild Mining and GELSENWASSER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, GELSENWASSER 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 GELSENWASSER will offset losses from the drop in GELSENWASSER's long position.| Hochschild Mining vs. ZIJIN MINH UNSPADR20 | Hochschild Mining vs. Superior Plus Corp | Hochschild Mining vs. NMI Holdings | Hochschild Mining vs. Origin Agritech |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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