Correlation Between LBG Media and Eastinco Mining
Can any of the company-specific risk be diversified away by investing in both LBG Media and Eastinco 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 LBG Media and Eastinco Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LBG Media PLC and Eastinco Mining Exploration, you can compare the effects of market volatilities on LBG Media and Eastinco 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 LBG Media with a short position of Eastinco Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of LBG Media and Eastinco Mining.
Diversification Opportunities for LBG Media and Eastinco Mining
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between LBG and Eastinco is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding LBG Media PLC and Eastinco Mining Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastinco Mining Expl and LBG Media 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 LBG Media PLC are associated (or correlated) with Eastinco Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastinco Mining Expl has no effect on the direction of LBG Media i.e., LBG Media and Eastinco Mining go up and down completely randomly.
Pair Corralation between LBG Media and Eastinco Mining
Assuming the 90 days trading horizon LBG Media PLC is expected to generate 1.49 times more return on investment than Eastinco Mining. However, LBG Media is 1.49 times more volatile than Eastinco Mining Exploration. It trades about 0.04 of its potential returns per unit of risk. Eastinco Mining Exploration is currently generating about -0.21 per unit of risk. If you would invest 13,100 in LBG Media PLC on September 22, 2024 and sell it today you would earn a total of 200.00 from holding LBG Media PLC or generate 1.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LBG Media PLC vs. Eastinco Mining Exploration
Performance |
| Timeline |
| LBG Media PLC |
| Eastinco Mining Expl |
LBG Media and Eastinco Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LBG Media and Eastinco Mining
The main advantage of trading using opposite LBG Media and Eastinco Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LBG Media position performs unexpectedly, Eastinco 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 Eastinco Mining will offset losses from the drop in Eastinco Mining's long position.| LBG Media vs. Quantum Blockchain Technologies | LBG Media vs. Versarien PLC | LBG Media vs. Argo Group Limited | LBG Media vs. Tungsten West PLC |
| Eastinco Mining vs. Givaudan SA | Eastinco Mining vs. Antofagasta PLC | Eastinco Mining vs. Ferrexpo PLC | Eastinco Mining vs. Atalaya Mining |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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