Correlation Between INTEL CDR and Lion One
Can any of the company-specific risk be diversified away by investing in both INTEL CDR and Lion One 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 INTEL CDR and Lion One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTEL CDR and Lion One Metals, you can compare the effects of market volatilities on INTEL CDR and Lion One 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 INTEL CDR with a short position of Lion One. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTEL CDR and Lion One.
Diversification Opportunities for INTEL CDR and Lion One
Modest diversification
The 3 months correlation between INTEL and Lion is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding INTEL CDR and Lion One Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion One Metals and INTEL CDR 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 INTEL CDR are associated (or correlated) with Lion One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion One Metals has no effect on the direction of INTEL CDR i.e., INTEL CDR and Lion One go up and down completely randomly.
Pair Corralation between INTEL CDR and Lion One
Assuming the 90 days trading horizon INTEL CDR is expected to generate 10.7 times less return on investment than Lion One. But when comparing it to its historical volatility, INTEL CDR is 1.41 times less risky than Lion One. It trades about 0.01 of its potential returns per unit of risk. Lion One Metals is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 29.00 in Lion One Metals on November 3, 2024 and sell it today you would earn a total of 9.00 from holding Lion One Metals or generate 31.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
INTEL CDR vs. Lion One Metals
Performance |
| Timeline |
| INTEL CDR |
| Lion One Metals |
INTEL CDR and Lion One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTEL CDR and Lion One
The main advantage of trading using opposite INTEL CDR and Lion One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTEL CDR position performs unexpectedly, Lion One 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 Lion One will offset losses from the drop in Lion One's long position.| INTEL CDR vs. Datable Technology Corp | INTEL CDR vs. Quipt Home Medical | INTEL CDR vs. Leons Furniture Limited | INTEL CDR vs. Dream Industrial Real |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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