Correlation Between Hochschild Mining and Vivendi SA
Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and Vivendi SA 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 Vivendi SA 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 Vivendi SA, you can compare the effects of market volatilities on Hochschild Mining and Vivendi SA 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 Vivendi SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and Vivendi SA.
Diversification Opportunities for Hochschild Mining and Vivendi SA
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hochschild and Vivendi is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining plc and Vivendi SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vivendi SA 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 Vivendi SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vivendi SA has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and Vivendi SA go up and down completely randomly.
Pair Corralation between Hochschild Mining and Vivendi SA
Assuming the 90 days trading horizon Hochschild Mining plc is expected to under-perform the Vivendi SA. In addition to that, Hochschild Mining is 2.35 times more volatile than Vivendi SA. It trades about -0.21 of its total potential returns per unit of risk. Vivendi SA is currently generating about 0.15 per unit of volatility. If you would invest 258.00 in Vivendi SA on November 3, 2024 and sell it today you would earn a total of 15.00 from holding Vivendi SA or generate 5.81% 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. Vivendi SA
Performance |
| Timeline |
| Hochschild Mining plc |
| Vivendi SA |
Hochschild Mining and Vivendi SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochschild Mining and Vivendi SA
The main advantage of trading using opposite Hochschild Mining and Vivendi SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, Vivendi SA 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 Vivendi SA will offset losses from the drop in Vivendi SA's long position.| Hochschild Mining vs. Hollywood Bowl Group | Hochschild Mining vs. Catena Media PLC | Hochschild Mining vs. Grand Vision Media | Hochschild Mining vs. Fulcrum Metals PLC |
| Vivendi SA vs. Chocoladefabriken Lindt Spruengli | Vivendi SA vs. Rockwood Realisation PLC | Vivendi SA vs. Toyota Motor Corp | Vivendi SA vs. Johnson Matthey PLC |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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