Correlation Between Lotus Resources and Intrepid Metals
Can any of the company-specific risk be diversified away by investing in both Lotus Resources and Intrepid Metals 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 Lotus Resources and Intrepid Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lotus Resources Limited and Intrepid Metals Corp, you can compare the effects of market volatilities on Lotus Resources and Intrepid Metals 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 Lotus Resources with a short position of Intrepid Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotus Resources and Intrepid Metals.
Diversification Opportunities for Lotus Resources and Intrepid Metals
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lotus and Intrepid is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Lotus Resources Limited and Intrepid Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intrepid Metals Corp and Lotus Resources 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 Lotus Resources Limited are associated (or correlated) with Intrepid Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intrepid Metals Corp has no effect on the direction of Lotus Resources i.e., Lotus Resources and Intrepid Metals go up and down completely randomly.
Pair Corralation between Lotus Resources and Intrepid Metals
Assuming the 90 days horizon Lotus Resources Limited is expected to under-perform the Intrepid Metals. But the otc stock apears to be less risky and, when comparing its historical volatility, Lotus Resources Limited is 1.0 times less risky than Intrepid Metals. The otc stock trades about -0.07 of its potential returns per unit of risk. The Intrepid Metals Corp is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 43.00 in Intrepid Metals Corp on August 25, 2024 and sell it today you would lose (13.00) from holding Intrepid Metals Corp or give up 30.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotus Resources Limited vs. Intrepid Metals Corp
Performance |
| Timeline |
| Lotus Resources |
| Intrepid Metals Corp |
Lotus Resources and Intrepid Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotus Resources and Intrepid Metals
The main advantage of trading using opposite Lotus Resources and Intrepid Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotus Resources position performs unexpectedly, Intrepid Metals 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 Intrepid Metals will offset losses from the drop in Intrepid Metals' long position.| Lotus Resources vs. Filo Mining Corp | Lotus Resources vs. Golden Goliath Resources | Lotus Resources vs. Stria Lithium | Lotus Resources vs. Monitor Ventures |
| Intrepid Metals vs. Legacy Education | Intrepid Metals vs. NVIDIA | Intrepid Metals vs. Apple Inc | Intrepid Metals vs. Microsoft |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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