Correlation Between Hudson Investment and MetalsGrove Mining

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

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

Diversification Opportunities for Hudson Investment and MetalsGrove Mining

0.0

Correlation Coefficient

Hudson Investment  MetalsGrove Mining

Pay attention - limited upside

The 3 months correlation between Hudson and MetalsGrove is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Hudson Investment Group and MetalsGrove Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetalsGrove Mining and Hudson Investment 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 Hudson Investment Group are associated (or correlated) with MetalsGrove Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetalsGrove Mining has no effect on the direction of Hudson Investment i.e., Hudson Investment and MetalsGrove Mining go up and down completely randomly.

Pair Corralation between Hudson Investment and MetalsGrove Mining

Assuming the 90 days trading horizon Hudson Investment Group is expected to under-perform the MetalsGrove Mining. But the stock apears to be less risky and, when comparing its historical volatility, Hudson Investment Group is 4.08 times less risky than MetalsGrove Mining. The stock trades about -0.03 of its potential returns per unit of risk. The MetalsGrove Mining is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  16.00  in MetalsGrove Mining on September 26, 2024 and sell it today you would lose (10.80) from holding MetalsGrove Mining or give up 67.5% of portfolio value over 90 days.

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

Hudson Investment Group  vs.  MetalsGrove Mining

Hudson Investment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hudson Investment Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Hudson Investment is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

MetalsGrove Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MetalsGrove Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Hudson Investment and MetalsGrove Mining

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

The idea behind Hudson Investment Group and MetalsGrove 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.

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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.