Correlation Between Hecla Mining and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Hecla Mining and Dow Jones 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 Hecla Mining and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hecla Mining and Dow Jones Industrial, you can compare the effects of market volatilities on Hecla Mining and Dow Jones 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 Hecla Mining with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hecla Mining and Dow Jones.
Diversification Opportunities for Hecla Mining and Dow Jones
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hecla and Dow is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Hecla Mining and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Hecla 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 Hecla Mining are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Hecla Mining i.e., Hecla Mining and Dow Jones go up and down completely randomly.
Pair Corralation between Hecla Mining and Dow Jones
Assuming the 90 days horizon Hecla Mining is expected to generate 2.33 times less return on investment than Dow Jones. In addition to that, Hecla Mining is 1.44 times more volatile than Dow Jones Industrial. It trades about 0.03 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.11 per unit of volatility. If you would invest 3,815,030 in Dow Jones Industrial on August 28, 2024 and sell it today you would earn a total of 658,627 from holding Dow Jones Industrial or generate 17.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.52% |
| Values | Daily Returns |
Hecla Mining vs. Dow Jones Industrial
Performance |
| Timeline |
Hecla Mining and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Hecla Mining
Pair trading matchups for Hecla Mining
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Hecla Mining and Dow Jones
The main advantage of trading using opposite Hecla Mining and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hecla Mining position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Hecla Mining vs. Triple Flag Precious | Hecla Mining vs. McEwen Mining | Hecla Mining vs. Endeavour Silver Corp | Hecla Mining vs. Hecla Mining |
| Dow Jones vs. CECO Environmental Corp | Dow Jones vs. Western Acquisition Ventures | Dow Jones vs. Tyson Foods | Dow Jones vs. Inflection Point Acquisition |
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.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |