Correlation Between Hitachi Metals and I Minerals

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

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

Diversification Opportunities for Hitachi Metals and I Minerals

0.0

Correlation Coefficient

Hitachi Metals  I Minerals

Pay attention - limited upside

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

Pair Corralation between Hitachi Metals and I Minerals

If you would invest  1.50  in I Minerals on September 1, 2024 and sell it today you would earn a total of  0.00  from holding I Minerals or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Hitachi Metals  vs.  I Minerals

Hitachi Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hitachi Metals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, Hitachi Metals is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

I Minerals

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Hitachi Metals and I Minerals

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

The idea behind Hitachi Metals and I Minerals 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.