Correlation Between KLA and Evolution Mining
Can any of the company-specific risk be diversified away by investing in both KLA and Evolution 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 KLA and Evolution Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KLA Corporation and Evolution Mining Limited, you can compare the effects of market volatilities on KLA and Evolution 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 KLA with a short position of Evolution Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of KLA and Evolution Mining.
Diversification Opportunities for KLA and Evolution Mining
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KLA and Evolution is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding KLA Corp. and Evolution Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolution Mining and KLA 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 KLA Corporation are associated (or correlated) with Evolution Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolution Mining has no effect on the direction of KLA i.e., KLA and Evolution Mining go up and down completely randomly.
Pair Corralation between KLA and Evolution Mining
Assuming the 90 days horizon KLA is expected to generate 1.51 times less return on investment than Evolution Mining. In addition to that, KLA is 1.05 times more volatile than Evolution Mining Limited. It trades about 0.05 of its total potential returns per unit of risk. Evolution Mining Limited is currently generating about 0.07 per unit of volatility. If you would invest 210.00 in Evolution Mining Limited on September 4, 2024 and sell it today you would earn a total of 105.00 from holding Evolution Mining Limited or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KLA Corp. vs. Evolution Mining Limited
Performance |
| Timeline |
| KLA Corporation |
| Evolution Mining |
KLA and Evolution Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KLA and Evolution Mining
The main advantage of trading using opposite KLA and Evolution Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KLA position performs unexpectedly, Evolution 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 Evolution Mining will offset losses from the drop in Evolution Mining's long position.| KLA vs. Evolution Mining Limited | KLA vs. Harmony Gold Mining | KLA vs. LION ONE METALS | KLA vs. SANOK RUBBER ZY |
| Evolution Mining vs. ZIJIN MINH UNSPADR20 | Evolution Mining vs. Barrick Gold | Evolution Mining vs. Superior Plus Corp | Evolution Mining vs. NMI Holdings |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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