Correlation Between Intermediate Capital and Hochschild Mining
Can any of the company-specific risk be diversified away by investing in both Intermediate Capital and Hochschild Mining 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 Intermediate Capital and Hochschild Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intermediate Capital Group and Hochschild Mining plc, you can compare the effects of market volatilities on Intermediate Capital and Hochschild Mining 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 Intermediate Capital with a short position of Hochschild Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intermediate Capital and Hochschild Mining.
Diversification Opportunities for Intermediate Capital and Hochschild Mining
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Intermediate and Hochschild is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Intermediate Capital Group and Hochschild Mining plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hochschild Mining plc and Intermediate Capital 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 Intermediate Capital Group are associated (or correlated) with Hochschild Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hochschild Mining plc has no effect on the direction of Intermediate Capital i.e., Intermediate Capital and Hochschild Mining go up and down completely randomly.
Pair Corralation between Intermediate Capital and Hochschild Mining
Assuming the 90 days trading horizon Intermediate Capital Group is expected to generate 0.88 times more return on investment than Hochschild Mining. However, Intermediate Capital Group is 1.14 times less risky than Hochschild Mining. It trades about -0.01 of its potential returns per unit of risk. Hochschild Mining plc is currently generating about -0.16 per unit of risk. If you would invest 211,800 in Intermediate Capital Group on August 30, 2024 and sell it today you would lose (2,400) from holding Intermediate Capital Group or give up 1.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intermediate Capital Group vs. Hochschild Mining plc
Performance |
| Timeline |
| Intermediate Capital |
| Hochschild Mining plc |
Intermediate Capital and Hochschild Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intermediate Capital and Hochschild Mining
The main advantage of trading using opposite Intermediate Capital and Hochschild Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intermediate Capital position performs unexpectedly, Hochschild Mining 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 Hochschild Mining will offset losses from the drop in Hochschild Mining's long position.| Intermediate Capital vs. Sabre Insurance Group | Intermediate Capital vs. Tatton Asset Management | Intermediate Capital vs. Zurich Insurance Group | Intermediate Capital vs. Associated British Foods |
| Hochschild Mining vs. Bankers Investment Trust | Hochschild Mining vs. Beowulf Mining | Hochschild Mining vs. Federal Realty Investment | Hochschild Mining vs. Eastinco Mining Exploration |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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