Correlation Between Lion One and STRAITS TRADG
Can any of the company-specific risk be diversified away by investing in both Lion One and STRAITS TRADG 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 STRAITS TRADG 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 STRAITS TRADG SD, you can compare the effects of market volatilities on Lion One and STRAITS TRADG 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 STRAITS TRADG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion One and STRAITS TRADG.
Diversification Opportunities for Lion One and STRAITS TRADG
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lion and STRAITS is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Lion One Metals and STRAITS TRADG SD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STRAITS TRADG SD 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 STRAITS TRADG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STRAITS TRADG SD has no effect on the direction of Lion One i.e., Lion One and STRAITS TRADG go up and down completely randomly.
Pair Corralation between Lion One and STRAITS TRADG
Assuming the 90 days horizon Lion One Metals is expected to under-perform the STRAITS TRADG. In addition to that, Lion One is 3.39 times more volatile than STRAITS TRADG SD. It trades about -0.22 of its total potential returns per unit of risk. STRAITS TRADG SD is currently generating about 0.05 per unit of volatility. If you would invest 98.00 in STRAITS TRADG SD on August 24, 2024 and sell it today you would earn a total of 1.00 from holding STRAITS TRADG SD or generate 1.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lion One Metals vs. STRAITS TRADG SD
Performance |
| Timeline |
| Lion One Metals |
| STRAITS TRADG SD |
Lion One and STRAITS TRADG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lion One and STRAITS TRADG
The main advantage of trading using opposite Lion One and STRAITS TRADG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion One position performs unexpectedly, STRAITS TRADG 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 STRAITS TRADG will offset losses from the drop in STRAITS TRADG's long position.| Lion One vs. Franco Nevada | Lion One vs. Agnico Eagle Mines | Lion One vs. Superior Plus Corp | Lion One vs. NMI Holdings |
| STRAITS TRADG vs. Lion One Metals | STRAITS TRADG vs. AXWAY SOFTWARE EO | STRAITS TRADG vs. CarsalesCom | STRAITS TRADG vs. GRUPO CARSO A1 |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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