Correlation Between Hochschild Mining and Radisson Mining
Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and Radisson 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 Hochschild Mining and Radisson Mining 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 Radisson Mining Resources, you can compare the effects of market volatilities on Hochschild Mining and Radisson 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 Hochschild Mining with a short position of Radisson Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and Radisson Mining.
Diversification Opportunities for Hochschild Mining and Radisson Mining
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hochschild and Radisson is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining PLC and Radisson Mining Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Radisson Mining Resources 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 Radisson Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Radisson Mining Resources has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and Radisson Mining go up and down completely randomly.
Pair Corralation between Hochschild Mining and Radisson Mining
Assuming the 90 days horizon Hochschild Mining PLC is expected to generate 0.68 times more return on investment than Radisson Mining. However, Hochschild Mining PLC is 1.46 times less risky than Radisson Mining. It trades about 0.09 of its potential returns per unit of risk. Radisson Mining Resources is currently generating about 0.05 per unit of risk. If you would invest 133.00 in Hochschild Mining PLC on September 14, 2024 and sell it today you would earn a total of 152.00 from holding Hochschild Mining PLC or generate 114.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hochschild Mining PLC vs. Radisson Mining Resources
Performance |
| Timeline |
| Hochschild Mining PLC |
| Radisson Mining Resources |
Hochschild Mining and Radisson Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochschild Mining and Radisson Mining
The main advantage of trading using opposite Hochschild Mining and Radisson Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, Radisson 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 Radisson Mining will offset losses from the drop in Radisson Mining's long position.| Hochschild Mining vs. Radisson Mining Resources | Hochschild Mining vs. Big Ridge Gold | Hochschild Mining vs. Cerrado Gold | Hochschild Mining vs. Orogen Royalties |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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