Correlation Between Juniata Valley and Lithium Americas
Can any of the company-specific risk be diversified away by investing in both Juniata Valley and Lithium Americas 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 Juniata Valley and Lithium Americas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Juniata Valley Financial and Lithium Americas Corp, you can compare the effects of market volatilities on Juniata Valley and Lithium Americas 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 Juniata Valley with a short position of Lithium Americas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Juniata Valley and Lithium Americas.
Diversification Opportunities for Juniata Valley and Lithium Americas
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Juniata and Lithium is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Juniata Valley Financial and Lithium Americas Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lithium Americas Corp and Juniata Valley 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 Juniata Valley Financial are associated (or correlated) with Lithium Americas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lithium Americas Corp has no effect on the direction of Juniata Valley i.e., Juniata Valley and Lithium Americas go up and down completely randomly.
Pair Corralation between Juniata Valley and Lithium Americas
Given the investment horizon of 90 days Juniata Valley Financial is expected to generate 0.6 times more return on investment than Lithium Americas. However, Juniata Valley Financial is 1.67 times less risky than Lithium Americas. It trades about 0.03 of its potential returns per unit of risk. Lithium Americas Corp is currently generating about -0.01 per unit of risk. If you would invest 1,295 in Juniata Valley Financial on September 12, 2024 and sell it today you would earn a total of 64.00 from holding Juniata Valley Financial or generate 4.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Juniata Valley Financial vs. Lithium Americas Corp
Performance |
| Timeline |
| Juniata Valley Financial |
| Lithium Americas Corp |
Juniata Valley and Lithium Americas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Juniata Valley and Lithium Americas
The main advantage of trading using opposite Juniata Valley and Lithium Americas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Juniata Valley position performs unexpectedly, Lithium Americas 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 Lithium Americas will offset losses from the drop in Lithium Americas' long position.| Juniata Valley vs. FNB Inc | Juniata Valley vs. Apollo Bancorp | Juniata Valley vs. Commercial National Financial | Juniata Valley vs. Eastern Michigan Financial |
| Lithium Americas vs. Lipocine | Lithium Americas vs. Solstad Offshore ASA | Lithium Americas vs. Alvarium Tiedemann Holdings | Lithium Americas vs. Radcom |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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