Correlation Between ZincX Resources and Stria Lithium
Can any of the company-specific risk be diversified away by investing in both ZincX Resources and Stria Lithium 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 ZincX Resources and Stria Lithium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZincX Resources Corp and Stria Lithium, you can compare the effects of market volatilities on ZincX Resources and Stria Lithium 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 ZincX Resources with a short position of Stria Lithium. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZincX Resources and Stria Lithium.
Diversification Opportunities for ZincX Resources and Stria Lithium
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ZincX and Stria is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding ZincX Resources Corp and Stria Lithium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stria Lithium and ZincX 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 ZincX Resources Corp are associated (or correlated) with Stria Lithium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stria Lithium has no effect on the direction of ZincX Resources i.e., ZincX Resources and Stria Lithium go up and down completely randomly.
Pair Corralation between ZincX Resources and Stria Lithium
Assuming the 90 days horizon ZincX Resources is expected to generate 35.89 times less return on investment than Stria Lithium. But when comparing it to its historical volatility, ZincX Resources Corp is 4.25 times less risky than Stria Lithium. It trades about 0.01 of its potential returns per unit of risk. Stria Lithium is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Stria Lithium on August 25, 2024 and sell it today you would lose (8.86) from holding Stria Lithium or give up 68.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ZincX Resources Corp vs. Stria Lithium
Performance |
| Timeline |
| ZincX Resources Corp |
| Stria Lithium |
ZincX Resources and Stria Lithium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZincX Resources and Stria Lithium
The main advantage of trading using opposite ZincX Resources and Stria Lithium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZincX Resources position performs unexpectedly, Stria Lithium 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 Stria Lithium will offset losses from the drop in Stria Lithium's long position.| ZincX Resources vs. Norra Metals Corp | ZincX Resources vs. Amarc Resources | ZincX Resources vs. Nuinsco Resources Limited | ZincX Resources vs. South Star Battery |
| Stria Lithium vs. Norra Metals Corp | Stria Lithium vs. Amarc Resources | Stria Lithium vs. ZincX Resources Corp | Stria Lithium vs. Nuinsco Resources Limited |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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