Correlation Between Clifton Mining and Hecla Mining

Can any of the company-specific risk be diversified away by investing in both Clifton Mining and Hecla 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 Clifton Mining and Hecla Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Clifton Mining Co and Hecla Mining, you can compare the effects of market volatilities on Clifton Mining and Hecla 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 Clifton Mining with a short position of Hecla Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clifton Mining and Hecla Mining.

Diversification Opportunities for Clifton Mining and Hecla Mining

0.12

Correlation Coefficient

Clifton Mining  Hecla Mining

Average diversification

The 3 months correlation between Clifton and Hecla is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Clifton Mining Co and Hecla Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hecla Mining and Clifton Mining 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 Clifton Mining Co are associated (or correlated) with Hecla Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hecla Mining has no effect on the direction of Clifton Mining i.e., Clifton Mining and Hecla Mining go up and down completely randomly.

Pair Corralation between Clifton Mining and Hecla Mining

Given the investment horizon of 90 days Clifton Mining Co is expected to under-perform the Hecla Mining. In addition to that, Clifton Mining is 3.44 times more volatile than Hecla Mining. It trades about -0.09 of its total potential returns per unit of risk. Hecla Mining is currently generating about 0.14 per unit of volatility. If you would invest  506.00  in Hecla Mining on October 23, 2024 and sell it today you would earn a total of  32.00  from holding Hecla Mining or generate 6.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Clifton Mining Co  vs.  Hecla Mining

Clifton Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Clifton Mining Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Hecla Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hecla Mining has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's essential indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Clifton Mining and Hecla Mining

The main advantage of trading using opposite Clifton Mining and Hecla Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clifton Mining position performs unexpectedly, Hecla 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 Hecla Mining will offset losses from the drop in Hecla Mining's long position.

The idea behind Clifton Mining Co and Hecla Mining pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Stocks Directory module to find actively traded stocks across global markets.