Correlation Between Hecla Mining and Ramaco Resources
Can any of the company-specific risk be diversified away by investing in both Hecla Mining and Ramaco Resources 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 Ramaco Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hecla Mining and Ramaco Resources, you can compare the effects of market volatilities on Hecla Mining and Ramaco Resources 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 Ramaco Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hecla Mining and Ramaco Resources.
Diversification Opportunities for Hecla Mining and Ramaco Resources
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hecla and Ramaco is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Hecla Mining and Ramaco Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ramaco Resources 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 Ramaco Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ramaco Resources has no effect on the direction of Hecla Mining i.e., Hecla Mining and Ramaco Resources go up and down completely randomly.
Pair Corralation between Hecla Mining and Ramaco Resources
Allowing for the 90-day total investment horizon Hecla Mining is expected to under-perform the Ramaco Resources. But the stock apears to be less risky and, when comparing its historical volatility, Hecla Mining is 1.23 times less risky than Ramaco Resources. The stock trades about -0.41 of its potential returns per unit of risk. The Ramaco Resources is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 1,029 in Ramaco Resources on August 27, 2024 and sell it today you would lose (17.00) from holding Ramaco Resources or give up 1.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hecla Mining vs. Ramaco Resources
Performance |
| Timeline |
| Hecla Mining |
| Ramaco Resources |
Hecla Mining and Ramaco Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hecla Mining and Ramaco Resources
The main advantage of trading using opposite Hecla Mining and Ramaco Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hecla Mining position performs unexpectedly, Ramaco Resources 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 Ramaco Resources will offset losses from the drop in Ramaco Resources' long position.| Hecla Mining vs. SilverCrest Metals | Hecla Mining vs. McEwen Mining | Hecla Mining vs. Avino Silver Gold | Hecla Mining vs. Metalla Royalty Streaming |
| Ramaco Resources vs. Molson Coors Brewing | Ramaco Resources vs. Compania Cervecerias Unidas | Ramaco Resources vs. Viemed Healthcare | Ramaco Resources vs. US Global Investors |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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