Correlation Between Lion One and Chemours
Can any of the company-specific risk be diversified away by investing in both Lion One and Chemours 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 Lion One and Chemours into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lion One Metals and Chemours Co, you can compare the effects of market volatilities on Lion One and Chemours 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 Lion One with a short position of Chemours. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion One and Chemours.
Diversification Opportunities for Lion One and Chemours
Significant diversification
The 3 months correlation between Lion and Chemours is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Lion One Metals and Chemours Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemours and Lion One 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 Lion One Metals are associated (or correlated) with Chemours. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemours has no effect on the direction of Lion One i.e., Lion One and Chemours go up and down completely randomly.
Pair Corralation between Lion One and Chemours
Assuming the 90 days horizon Lion One Metals is expected to under-perform the Chemours. In addition to that, Lion One is 1.25 times more volatile than Chemours Co. It trades about -0.1 of its total potential returns per unit of risk. Chemours Co is currently generating about -0.01 per unit of volatility. If you would invest 2,376 in Chemours Co on August 31, 2024 and sell it today you would lose (202.00) from holding Chemours Co or give up 8.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Lion One Metals vs. Chemours Co
Performance |
| Timeline |
| Lion One Metals |
| Chemours |
Lion One and Chemours Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lion One and Chemours
The main advantage of trading using opposite Lion One and Chemours positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion One position performs unexpectedly, Chemours 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 Chemours will offset losses from the drop in Chemours' long position.| Lion One vs. Irving Resources | Lion One vs. Headwater Gold | Lion One vs. Novo Resources Corp | Lion One vs. Snowline Gold Corp |
| Chemours vs. International Flavors Fragrances | Chemours vs. Air Products and | Chemours vs. PPG Industries | Chemours vs. Linde plc Ordinary |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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