Correlation Between Hecla Mining and Clifton Mining

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

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

Diversification Opportunities for Hecla Mining and Clifton Mining

0.12

Correlation Coefficient

Hecla Mining  Clifton Mining

Average diversification

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

Pair Corralation between Hecla Mining and Clifton Mining

Allowing for the 90-day total investment horizon Hecla Mining is expected to generate 0.29 times more return on investment than Clifton Mining. However, Hecla Mining is 3.44 times less risky than Clifton Mining. It trades about 0.14 of its potential returns per unit of risk. Clifton Mining Co is currently generating about -0.09 per unit of risk. 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

Hecla Mining  vs.  Clifton Mining Co

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.

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.

Pair Trading with Hecla Mining and Clifton Mining

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

The idea behind Hecla Mining and Clifton Mining Co 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.