Correlation Between Teck Resources and Sayona Mining
Can any of the company-specific risk be diversified away by investing in both Teck Resources and Sayona Mining 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 Teck Resources and Sayona Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teck Resources Ltd and Sayona Mining Limited, you can compare the effects of market volatilities on Teck Resources and Sayona Mining 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 Teck Resources with a short position of Sayona Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teck Resources and Sayona Mining.
Diversification Opportunities for Teck Resources and Sayona Mining
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Teck and Sayona is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Teck Resources Ltd and Sayona Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sayona Mining Limited and Teck Resources 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 Teck Resources Ltd are associated (or correlated) with Sayona Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sayona Mining Limited has no effect on the direction of Teck Resources i.e., Teck Resources and Sayona Mining go up and down completely randomly.
Pair Corralation between Teck Resources and Sayona Mining
Given the investment horizon of 90 days Teck Resources Ltd is expected to generate 0.26 times more return on investment than Sayona Mining. However, Teck Resources Ltd is 3.85 times less risky than Sayona Mining. It trades about -0.03 of its potential returns per unit of risk. Sayona Mining Limited is currently generating about -0.04 per unit of risk. If you would invest 4,719 in Teck Resources Ltd on August 31, 2024 and sell it today you would lose (95.00) from holding Teck Resources Ltd or give up 2.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Teck Resources Ltd vs. Sayona Mining Limited
Performance |
| Timeline |
| Teck Resources |
| Sayona Mining Limited |
Teck Resources and Sayona Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teck Resources and Sayona Mining
The main advantage of trading using opposite Teck Resources and Sayona Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teck Resources position performs unexpectedly, Sayona Mining 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 Sayona Mining will offset losses from the drop in Sayona Mining's long position.| Teck Resources vs. Piedmont Lithium Ltd | Teck Resources vs. Standard Lithium | Teck Resources vs. Vale SA ADR | Teck Resources vs. BHP Group Limited |
| Sayona Mining vs. Portofino Resources | Sayona Mining vs. Core Lithium | Sayona Mining vs. Global Energy Metals | Sayona Mining vs. Clime Investment Management |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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