Correlation Between Lithium Americas and Computer Modelling
Can any of the company-specific risk be diversified away by investing in both Lithium Americas and Computer Modelling 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 Lithium Americas and Computer Modelling into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lithium Americas Corp and Computer Modelling Group, you can compare the effects of market volatilities on Lithium Americas and Computer Modelling 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 Lithium Americas with a short position of Computer Modelling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lithium Americas and Computer Modelling.
Diversification Opportunities for Lithium Americas and Computer Modelling
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lithium and Computer is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Lithium Americas Corp and Computer Modelling Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Modelling and Lithium Americas 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 Lithium Americas Corp are associated (or correlated) with Computer Modelling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Modelling has no effect on the direction of Lithium Americas i.e., Lithium Americas and Computer Modelling go up and down completely randomly.
Pair Corralation between Lithium Americas and Computer Modelling
Assuming the 90 days trading horizon Lithium Americas Corp is expected to generate 1.04 times more return on investment than Computer Modelling. However, Lithium Americas is 1.04 times more volatile than Computer Modelling Group. It trades about 0.0 of its potential returns per unit of risk. Computer Modelling Group is currently generating about -0.13 per unit of risk. If you would invest 484.00 in Lithium Americas Corp on September 1, 2024 and sell it today you would lose (5.00) from holding Lithium Americas Corp or give up 1.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lithium Americas Corp vs. Computer Modelling Group
Performance |
| Timeline |
| Lithium Americas Corp |
| Computer Modelling |
Lithium Americas and Computer Modelling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lithium Americas and Computer Modelling
The main advantage of trading using opposite Lithium Americas and Computer Modelling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lithium Americas position performs unexpectedly, Computer Modelling 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 Computer Modelling will offset losses from the drop in Computer Modelling's long position.| Lithium Americas vs. Medical Facilities | Lithium Americas vs. Ocumetics Technology Corp | Lithium Americas vs. Birchtech Corp | Lithium Americas vs. High Liner Foods |
| Computer Modelling vs. Pason Systems | Computer Modelling vs. Evertz Technologies Limited | Computer Modelling vs. Descartes Systems Group | Computer Modelling vs. Enerflex |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |