Correlation Between Hochschild Mining and Bank of Georgia
Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and Bank of Georgia 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 Bank of Georgia 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 Bank of Georgia, you can compare the effects of market volatilities on Hochschild Mining and Bank of Georgia 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 Bank of Georgia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and Bank of Georgia.
Diversification Opportunities for Hochschild Mining and Bank of Georgia
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hochschild and Bank is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining plc and Bank of Georgia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Georgia 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 Bank of Georgia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Georgia has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and Bank of Georgia go up and down completely randomly.
Pair Corralation between Hochschild Mining and Bank of Georgia
Assuming the 90 days trading horizon Hochschild Mining plc is expected to generate 1.56 times more return on investment than Bank of Georgia. However, Hochschild Mining is 1.56 times more volatile than Bank of Georgia. It trades about 0.18 of its potential returns per unit of risk. Bank of Georgia is currently generating about 0.0 per unit of risk. If you would invest 21,300 in Hochschild Mining plc on October 24, 2024 and sell it today you would earn a total of 1,600 from holding Hochschild Mining plc or generate 7.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hochschild Mining plc vs. Bank of Georgia
Performance |
| Timeline |
| Hochschild Mining plc |
| Bank of Georgia |
Hochschild Mining and Bank of Georgia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochschild Mining and Bank of Georgia
The main advantage of trading using opposite Hochschild Mining and Bank of Georgia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, Bank of Georgia 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 Bank of Georgia will offset losses from the drop in Bank of Georgia's long position.| Hochschild Mining vs. Givaudan SA | Hochschild Mining vs. Antofagasta PLC | Hochschild Mining vs. Ferrexpo PLC | Hochschild Mining vs. Atalaya Mining |
| Bank of Georgia vs. McEwen Mining | Bank of Georgia vs. BlackRock Frontiers Investment | Bank of Georgia vs. Elmos Semiconductor SE | Bank of Georgia vs. Zurich Insurance Group |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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