Correlation Between High Roller and LithiumBank Resources

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

By analyzing existing cross correlation between High Roller Technologies, and LithiumBank Resources Corp, you can compare the effects of market volatilities on High Roller and LithiumBank Resources 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 High Roller with a short position of LithiumBank Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of High Roller and LithiumBank Resources.

Diversification Opportunities for High Roller and LithiumBank Resources

0.01

Correlation Coefficient

High Roller  LithiumBank Resources

Significant diversification

The 3 months correlation between High and LithiumBank is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding High Roller Technologies, and LithiumBank Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LithiumBank Resources and High Roller 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 High Roller Technologies, are associated (or correlated) with LithiumBank Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LithiumBank Resources has no effect on the direction of High Roller i.e., High Roller and LithiumBank Resources go up and down completely randomly.

Pair Corralation between High Roller and LithiumBank Resources

Given the investment horizon of 90 days High Roller Technologies, is expected to under-perform the LithiumBank Resources. But the stock apears to be less risky and, when comparing its historical volatility, High Roller Technologies, is 3.75 times less risky than LithiumBank Resources. The stock trades about -0.64 of its potential returns per unit of risk. The LithiumBank Resources Corp is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  14.00  in LithiumBank Resources Corp on December 5, 2024 and sell it today you would earn a total of  5.00  from holding LithiumBank Resources Corp or generate 35.71% return on investment over 90 days.

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

High Roller Technologies,  vs.  LithiumBank Resources Corp

High Roller Technologies,

Risk-Adjusted Performance

Very Weak

Over the last 90 days High Roller Technologies, has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's essential indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

LithiumBank Resources

Risk-Adjusted Performance

Very Weak

Over the last 90 days LithiumBank Resources Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward-looking signals, LithiumBank Resources is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with High Roller and LithiumBank Resources

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

The idea behind High Roller Technologies, and LithiumBank Resources 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.