Correlation Between Global Battery and Lomiko Metals
Can any of the company-specific risk be diversified away by investing in both Global Battery and Lomiko 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 Global Battery and Lomiko Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Battery Metals and Lomiko Metals, you can compare the effects of market volatilities on Global Battery and Lomiko 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 Global Battery with a short position of Lomiko Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Battery and Lomiko Metals.
Diversification Opportunities for Global Battery and Lomiko Metals
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Lomiko is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Global Battery Metals and Lomiko Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lomiko Metals and Global Battery 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 Global Battery Metals are associated (or correlated) with Lomiko Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lomiko Metals has no effect on the direction of Global Battery i.e., Global Battery and Lomiko Metals go up and down completely randomly.
Pair Corralation between Global Battery and Lomiko Metals
Assuming the 90 days horizon Global Battery is expected to generate 446.94 times less return on investment than Lomiko Metals. But when comparing it to its historical volatility, Global Battery Metals is 17.97 times less risky than Lomiko Metals. It trades about 0.01 of its potential returns per unit of risk. Lomiko Metals is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 20.00 in Lomiko Metals on September 3, 2024 and sell it today you would lose (10.80) from holding Lomiko Metals or give up 54.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Global Battery Metals vs. Lomiko Metals
Performance |
| Timeline |
| Global Battery Metals |
| Lomiko Metals |
Global Battery and Lomiko Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Battery and Lomiko Metals
The main advantage of trading using opposite Global Battery and Lomiko Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Battery position performs unexpectedly, Lomiko 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 Lomiko Metals will offset losses from the drop in Lomiko Metals' long position.| Global Battery vs. Altair International Corp | Global Battery vs. Lake Resources NL | Global Battery vs. Jourdan Resources | Global Battery vs. Lomiko Metals |
| Lomiko Metals vs. ZincX Resources Corp | Lomiko Metals vs. Mundoro Capital | Lomiko Metals vs. Strategic Resources | Lomiko Metals vs. Norra Metals Corp |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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