Correlation Between Hochschild Mining and Ion Beam
Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and Ion Beam 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 Ion Beam 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 Ion Beam Applications, you can compare the effects of market volatilities on Hochschild Mining and Ion Beam 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 Ion Beam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and Ion Beam.
Diversification Opportunities for Hochschild Mining and Ion Beam
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hochschild and Ion is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining plc and Ion Beam Applications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ion Beam Applications 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 Ion Beam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ion Beam Applications has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and Ion Beam go up and down completely randomly.
Pair Corralation between Hochschild Mining and Ion Beam
Assuming the 90 days trading horizon Hochschild Mining plc is expected to generate 1.44 times more return on investment than Ion Beam. However, Hochschild Mining is 1.44 times more volatile than Ion Beam Applications. It trades about 0.09 of its potential returns per unit of risk. Ion Beam Applications is currently generating about 0.11 per unit of risk. If you would invest 21,450 in Hochschild Mining plc on September 14, 2024 and sell it today you would earn a total of 1,150 from holding Hochschild Mining plc or generate 5.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hochschild Mining plc vs. Ion Beam Applications
Performance |
| Timeline |
| Hochschild Mining plc |
| Ion Beam Applications |
Hochschild Mining and Ion Beam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochschild Mining and Ion Beam
The main advantage of trading using opposite Hochschild Mining and Ion Beam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, Ion Beam 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 Ion Beam will offset losses from the drop in Ion Beam's long position.| Hochschild Mining vs. Sunny Optical Technology | Hochschild Mining vs. Symphony Environmental Technologies | Hochschild Mining vs. Solstad Offshore ASA | Hochschild Mining vs. Ironveld Plc |
| Ion Beam vs. Finnair Oyj | Ion Beam vs. Wizz Air Holdings | Ion Beam vs. Infrastrutture Wireless Italiane | Ion Beam vs. Associated British Foods |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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