Correlation Between First Quantum and BANK HANDLOWY

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

By analyzing existing cross correlation between First Quantum Minerals and BANK HANDLOWY, you can compare the effects of market volatilities on First Quantum and BANK HANDLOWY 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 First Quantum with a short position of BANK HANDLOWY. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Quantum and BANK HANDLOWY.

Diversification Opportunities for First Quantum and BANK HANDLOWY

-0.08

Correlation Coefficient

First Quantum  BANK HANDLOWY

Good diversification

The 3 months correlation between First and BANK is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding First Quantum Minerals and BANK HANDLOWY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK HANDLOWY and First Quantum 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 First Quantum Minerals are associated (or correlated) with BANK HANDLOWY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK HANDLOWY has no effect on the direction of First Quantum i.e., First Quantum and BANK HANDLOWY go up and down completely randomly.

Pair Corralation between First Quantum and BANK HANDLOWY

Assuming the 90 days horizon First Quantum Minerals is expected to under-perform the BANK HANDLOWY. But the stock apears to be less risky and, when comparing its historical volatility, First Quantum Minerals is 1.19 times less risky than BANK HANDLOWY. The stock trades about 0.0 of its potential returns per unit of risk. The BANK HANDLOWY is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  473.00  in BANK HANDLOWY on September 20, 2024 and sell it today you would earn a total of  1,632  from holding BANK HANDLOWY or generate 345.03% return on investment over 90 days.

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

First Quantum Minerals  vs.  BANK HANDLOWY

First Quantum Minerals

Risk-Adjusted Performance

3 of 100

Insignificant

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

BANK HANDLOWY

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with First Quantum and BANK HANDLOWY

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

The idea behind First Quantum Minerals and BANK HANDLOWY 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..