Correlation Between Lundin Mining and Goodbye Kansas
Can any of the company-specific risk be diversified away by investing in both Lundin Mining and Goodbye Kansas 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 Lundin Mining and Goodbye Kansas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lundin Mining and Goodbye Kansas Group, you can compare the effects of market volatilities on Lundin Mining and Goodbye Kansas 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 Lundin Mining with a short position of Goodbye Kansas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Mining and Goodbye Kansas.
Diversification Opportunities for Lundin Mining and Goodbye Kansas
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lundin and Goodbye is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Mining and Goodbye Kansas Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goodbye Kansas Group and Lundin Mining 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 Lundin Mining are associated (or correlated) with Goodbye Kansas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goodbye Kansas Group has no effect on the direction of Lundin Mining i.e., Lundin Mining and Goodbye Kansas go up and down completely randomly.
Pair Corralation between Lundin Mining and Goodbye Kansas
Assuming the 90 days trading horizon Lundin Mining is expected to generate 14.17 times less return on investment than Goodbye Kansas. But when comparing it to its historical volatility, Lundin Mining is 2.06 times less risky than Goodbye Kansas. It trades about 0.07 of its potential returns per unit of risk. Goodbye Kansas Group is currently generating about 0.5 of returns per unit of risk over similar time horizon. If you would invest 145.00 in Goodbye Kansas Group on October 24, 2024 and sell it today you would earn a total of 63.00 from holding Goodbye Kansas Group or generate 43.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
Lundin Mining vs. Goodbye Kansas Group
Performance |
| Timeline |
| Lundin Mining |
| Goodbye Kansas Group |
Lundin Mining and Goodbye Kansas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Mining and Goodbye Kansas
The main advantage of trading using opposite Lundin Mining and Goodbye Kansas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Mining position performs unexpectedly, Goodbye Kansas 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 Goodbye Kansas will offset losses from the drop in Goodbye Kansas' long position.| Lundin Mining vs. Boliden AB | Lundin Mining vs. Lundin Gold | Lundin Mining vs. SSAB AB | Lundin Mining vs. AB SKF |
| Goodbye Kansas vs. Lundin Mining | Goodbye Kansas vs. Kinnevik Investment AB | Goodbye Kansas vs. Nordic Iron Ore | Goodbye Kansas vs. Nordic Asia Investment |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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