Correlation Between Hudson Resources and International Lithium
Can any of the company-specific risk be diversified away by investing in both Hudson Resources and International Lithium 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 Hudson Resources and International Lithium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hudson Resources and International Lithium Corp, you can compare the effects of market volatilities on Hudson Resources and International Lithium 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 Hudson Resources with a short position of International Lithium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hudson Resources and International Lithium.
Diversification Opportunities for Hudson Resources and International Lithium
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hudson and International is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Hudson Resources and International Lithium Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Lithium and Hudson Resources 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 Hudson Resources are associated (or correlated) with International Lithium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Lithium has no effect on the direction of Hudson Resources i.e., Hudson Resources and International Lithium go up and down completely randomly.
Pair Corralation between Hudson Resources and International Lithium
Assuming the 90 days horizon Hudson Resources is expected to generate 2.53 times more return on investment than International Lithium. However, Hudson Resources is 2.53 times more volatile than International Lithium Corp. It trades about 0.08 of its potential returns per unit of risk. International Lithium Corp is currently generating about 0.0 per unit of risk. If you would invest 2.00 in Hudson Resources on August 26, 2024 and sell it today you would earn a total of 0.00 from holding Hudson Resources or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hudson Resources vs. International Lithium Corp
Performance |
| Timeline |
| Hudson Resources |
| International Lithium |
Hudson Resources and International Lithium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hudson Resources and International Lithium
The main advantage of trading using opposite Hudson Resources and International Lithium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hudson Resources position performs unexpectedly, International Lithium 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 International Lithium will offset losses from the drop in International Lithium's long position.| Hudson Resources vs. Ascendant Resources | Hudson Resources vs. Cantex Mine Development | Hudson Resources vs. Amarc Resources | Hudson Resources vs. Sterling Metals Corp |
| International Lithium vs. Decade Resources | International Lithium vs. Silver Spruce Resources | International Lithium vs. Grid Metals Corp | International Lithium vs. Canada Rare Earth |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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