Correlation Between Hochschild Mining and Hershey
Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and Hershey 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 Hershey 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 Hershey Co, you can compare the effects of market volatilities on Hochschild Mining and Hershey 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 Hershey. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and Hershey.
Diversification Opportunities for Hochschild Mining and Hershey
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hochschild and Hershey is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining plc and Hershey Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hershey 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 Hershey. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hershey has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and Hershey go up and down completely randomly.
Pair Corralation between Hochschild Mining and Hershey
Assuming the 90 days trading horizon Hochschild Mining plc is expected to generate 0.75 times more return on investment than Hershey. However, Hochschild Mining plc is 1.34 times less risky than Hershey. It trades about 0.01 of its potential returns per unit of risk. Hershey Co is currently generating about -0.02 per unit of risk. If you would invest 21,250 in Hochschild Mining plc on September 28, 2024 and sell it today you would lose (50.00) from holding Hochschild Mining plc or give up 0.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hochschild Mining plc vs. Hershey Co
Performance |
| Timeline |
| Hochschild Mining plc |
| Hershey |
Hochschild Mining and Hershey Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochschild Mining and Hershey
The main advantage of trading using opposite Hochschild Mining and Hershey positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, Hershey 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 Hershey will offset losses from the drop in Hershey's long position.| Hochschild Mining vs. Givaudan SA | Hochschild Mining vs. Antofagasta PLC | Hochschild Mining vs. Ferrexpo PLC | Hochschild Mining vs. Atalaya Mining |
| Hershey vs. Symphony Environmental Technologies | Hershey vs. Atalaya Mining | Hershey vs. Hochschild Mining plc | Hershey vs. Silver Bullet Data |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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