Correlation Between LION ONE and HNI
Can any of the company-specific risk be diversified away by investing in both LION ONE and HNI 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 HNI 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 HNI Corporation, you can compare the effects of market volatilities on LION ONE and HNI 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 HNI. Check out your portfolio center. Please also check ongoing floating volatility patterns of LION ONE and HNI.
Diversification Opportunities for LION ONE and HNI
Good diversification
The 3 months correlation between LION and HNI is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding LION ONE METALS and HNI Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HNI Corporation 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 HNI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HNI Corporation has no effect on the direction of LION ONE i.e., LION ONE and HNI go up and down completely randomly.
Pair Corralation between LION ONE and HNI
Assuming the 90 days trading horizon LION ONE METALS is expected to under-perform the HNI. In addition to that, LION ONE is 2.06 times more volatile than HNI Corporation. It trades about -0.03 of its total potential returns per unit of risk. HNI Corporation is currently generating about 0.09 per unit of volatility. If you would invest 2,415 in HNI Corporation on August 31, 2024 and sell it today you would earn a total of 2,785 from holding HNI Corporation or generate 115.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
LION ONE METALS vs. HNI Corp.
Performance |
Timeline |
LION ONE METALS |
HNI Corporation |
LION ONE and HNI Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with LION ONE and HNI
The main advantage of trading using opposite LION ONE and HNI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LION ONE position performs unexpectedly, HNI 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 HNI will offset losses from the drop in HNI's long position.LION ONE vs. SIVERS SEMICONDUCTORS AB | LION ONE vs. Darden Restaurants | LION ONE vs. Reliance Steel Aluminum | LION ONE vs. Q2M Managementberatung AG |
HNI vs. Sabra Health Care | HNI vs. FEMALE HEALTH | HNI vs. Nucletron Electronic Aktiengesellschaft | HNI vs. YOOMA WELLNESS INC |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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