Correlation Between Hochschild Mining and 98379JAA3

Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and 98379JAA3 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 Hochschild Mining and 98379JAA3 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hochschild Mining PLC and RXO 75 15 NOV 27, you can compare the effects of market volatilities on Hochschild Mining and 98379JAA3 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 Hochschild Mining with a short position of 98379JAA3. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and 98379JAA3.

Diversification Opportunities for Hochschild Mining and 98379JAA3

0.03

Correlation Coefficient

Hochschild Mining  98379JAA3

Significant diversification

The 3 months correlation between Hochschild and 98379JAA3 is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining PLC and RXO 75 15 NOV 27 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RXO 75 15 and Hochschild 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 Hochschild Mining PLC are associated (or correlated) with 98379JAA3. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RXO 75 15 has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and 98379JAA3 go up and down completely randomly.

Pair Corralation between Hochschild Mining and 98379JAA3

Assuming the 90 days horizon Hochschild Mining PLC is expected to generate 10.42 times more return on investment than 98379JAA3. However, Hochschild Mining is 10.42 times more volatile than RXO 75 15 NOV 27. It trades about 0.07 of its potential returns per unit of risk. RXO 75 15 NOV 27 is currently generating about 0.01 per unit of risk. If you would invest  96.00  in Hochschild Mining PLC on October 11, 2024 and sell it today you would earn a total of  182.00  from holding Hochschild Mining PLC or generate 189.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	68.69%
Values	Daily Returns

Hochschild Mining PLC  vs.  RXO 75 15 NOV 27

Hochschild Mining PLC

Risk-Adjusted Performance

3 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Hochschild Mining PLC are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental indicators, Hochschild Mining may actually be approaching a critical reversion point that can send shares even higher in February 2025.

RXO 75 15

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in RXO 75 15 NOV 27 are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 98379JAA3 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Hochschild Mining and 98379JAA3

The main advantage of trading using opposite Hochschild Mining and 98379JAA3 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, 98379JAA3 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 98379JAA3 will offset losses from the drop in 98379JAA3's long position.

The idea behind Hochschild Mining PLC and RXO 75 15 NOV 27 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.