Correlation Between LION ONE and Perma-Fix Environmental
Can any of the company-specific risk be diversified away by investing in both LION ONE and Perma-Fix Environmental 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 Perma-Fix Environmental 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 Perma Fix Environmental Services, you can compare the effects of market volatilities on LION ONE and Perma-Fix Environmental 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 Perma-Fix Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of LION ONE and Perma-Fix Environmental.
Diversification Opportunities for LION ONE and Perma-Fix Environmental
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between LION and Perma-Fix is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding LION ONE METALS and Perma Fix Environmental Servic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perma Fix Environmental 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 Perma-Fix Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perma Fix Environmental has no effect on the direction of LION ONE i.e., LION ONE and Perma-Fix Environmental go up and down completely randomly.
Pair Corralation between LION ONE and Perma-Fix Environmental
Assuming the 90 days trading horizon LION ONE METALS is expected to under-perform the Perma-Fix Environmental. In addition to that, LION ONE is 1.73 times more volatile than Perma Fix Environmental Services. It trades about -0.19 of its total potential returns per unit of risk. Perma Fix Environmental Services is currently generating about -0.24 per unit of volatility. If you would invest 960.00 in Perma Fix Environmental Services on December 1, 2024 and sell it today you would lose (205.00) from holding Perma Fix Environmental Services or give up 21.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
LION ONE METALS vs. Perma Fix Environmental Servic
Performance |
| Timeline |
| LION ONE METALS |
| Perma Fix Environmental |
LION ONE and Perma-Fix Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LION ONE and Perma-Fix Environmental
The main advantage of trading using opposite LION ONE and Perma-Fix Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LION ONE position performs unexpectedly, Perma-Fix Environmental 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 Perma-Fix Environmental will offset losses from the drop in Perma-Fix Environmental's long position.| LION ONE vs. ANTA Sports Products | LION ONE vs. Addtech AB | LION ONE vs. PLAYTECH | LION ONE vs. Uber Technologies |
| Perma-Fix Environmental vs. EITZEN CHEMICALS | Perma-Fix Environmental vs. CHEMICAL INDUSTRIES | Perma-Fix Environmental vs. Chengdu PUTIAN Telecommunications | Perma-Fix Environmental vs. AIR PRODCHEMICALS |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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