Correlation Between Hochschild Mining and SupplyMe Capital
Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and SupplyMe Capital 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 SupplyMe Capital 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 SupplyMe Capital PLC, you can compare the effects of market volatilities on Hochschild Mining and SupplyMe Capital 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 SupplyMe Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and SupplyMe Capital.
Diversification Opportunities for Hochschild Mining and SupplyMe Capital
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hochschild and SupplyMe is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining plc and SupplyMe Capital PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SupplyMe Capital PLC 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 SupplyMe Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SupplyMe Capital PLC has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and SupplyMe Capital go up and down completely randomly.
Pair Corralation between Hochschild Mining and SupplyMe Capital
Assuming the 90 days trading horizon Hochschild Mining is expected to generate 3.83 times less return on investment than SupplyMe Capital. But when comparing it to its historical volatility, Hochschild Mining plc is 5.59 times less risky than SupplyMe Capital. It trades about 0.18 of its potential returns per unit of risk. SupplyMe Capital PLC is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 0.30 in SupplyMe Capital PLC on September 13, 2024 and sell it today you would earn a total of 0.06 from holding SupplyMe Capital PLC or generate 20.0% 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. SupplyMe Capital PLC
Performance |
| Timeline |
| Hochschild Mining plc |
| SupplyMe Capital PLC |
Hochschild Mining and SupplyMe Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochschild Mining and SupplyMe Capital
The main advantage of trading using opposite Hochschild Mining and SupplyMe Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, SupplyMe Capital 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 SupplyMe Capital will offset losses from the drop in SupplyMe Capital's long position.| Hochschild Mining vs. Givaudan SA | Hochschild Mining vs. Antofagasta PLC | Hochschild Mining vs. Ferrexpo PLC | Hochschild Mining vs. Atalaya Mining |
| SupplyMe Capital vs. Panther Metals PLC | SupplyMe Capital vs. Southern Copper Corp | SupplyMe Capital vs. Cornish Metals | SupplyMe Capital 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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