Correlation Between Link Reservations and US Lithium

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

By analyzing existing cross correlation between Link Reservations and US Lithium Corp, you can compare the effects of market volatilities on Link Reservations and US Lithium 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 Link Reservations with a short position of US Lithium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Link Reservations and US Lithium.

Diversification Opportunities for Link Reservations and US Lithium

0.0

Correlation Coefficient

Link Reservations  US Lithium

Pay attention - limited upside

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

Pair Corralation between Link Reservations and US Lithium

If you would invest  0.01  in US Lithium Corp on December 27, 2024 and sell it today you would earn a total of  0.00  from holding US Lithium Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.77%
Values	Daily Returns

Link Reservations  vs.  US Lithium Corp

Link Reservations

Risk-Adjusted Performance

Very Weak

Over the last 90 days Link Reservations has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

US Lithium Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days US Lithium Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, US Lithium is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Link Reservations and US Lithium

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

The idea behind Link Reservations and US Lithium Corp 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.