Correlation Between Hudbay Minerals and Labrador Gold
Can any of the company-specific risk be diversified away by investing in both Hudbay Minerals and Labrador Gold 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 Hudbay Minerals and Labrador Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hudbay Minerals and Labrador Gold Corp, you can compare the effects of market volatilities on Hudbay Minerals and Labrador Gold 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 Hudbay Minerals with a short position of Labrador Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hudbay Minerals and Labrador Gold.
Diversification Opportunities for Hudbay Minerals and Labrador Gold
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hudbay and Labrador is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Hudbay Minerals and Labrador Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Labrador Gold Corp and Hudbay Minerals 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 Hudbay Minerals are associated (or correlated) with Labrador Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Labrador Gold Corp has no effect on the direction of Hudbay Minerals i.e., Hudbay Minerals and Labrador Gold go up and down completely randomly.
Pair Corralation between Hudbay Minerals and Labrador Gold
Considering the 90-day investment horizon Hudbay Minerals is expected to generate 0.6 times more return on investment than Labrador Gold. However, Hudbay Minerals is 1.68 times less risky than Labrador Gold. It trades about -0.07 of its potential returns per unit of risk. Labrador Gold Corp is currently generating about -0.2 per unit of risk. If you would invest 931.00 in Hudbay Minerals on August 31, 2024 and sell it today you would lose (54.00) from holding Hudbay Minerals or give up 5.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hudbay Minerals vs. Labrador Gold Corp
Performance |
| Timeline |
| Hudbay Minerals |
| Labrador Gold Corp |
Hudbay Minerals and Labrador Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hudbay Minerals and Labrador Gold
The main advantage of trading using opposite Hudbay Minerals and Labrador Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hudbay Minerals position performs unexpectedly, Labrador Gold 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 Labrador Gold will offset losses from the drop in Labrador Gold's long position.| Hudbay Minerals vs. Teck Resources Ltd | Hudbay Minerals vs. Fortuna Silver Mines | Hudbay Minerals vs. Osisko Gold Ro | Hudbay Minerals vs. Nexa Resources SA |
| Labrador Gold vs. Exploits Discovery Corp | Labrador Gold vs. Mako Mining Corp | Labrador Gold vs. Puma Exploration | Labrador Gold vs. Aurion Resources |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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