Correlation Between Founders Metals and Meridian Mining
Can any of the company-specific risk be diversified away by investing in both Founders Metals and Meridian 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 Founders Metals and Meridian Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Founders Metals and Meridian Mining UK, you can compare the effects of market volatilities on Founders Metals and Meridian 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 Founders Metals with a short position of Meridian Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Founders Metals and Meridian Mining.
Diversification Opportunities for Founders Metals and Meridian Mining
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Founders and Meridian is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Founders Metals and Meridian Mining UK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meridian Mining UK and Founders 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 Founders Metals are associated (or correlated) with Meridian Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meridian Mining UK has no effect on the direction of Founders Metals i.e., Founders Metals and Meridian Mining go up and down completely randomly.
Pair Corralation between Founders Metals and Meridian Mining
Assuming the 90 days horizon Founders Metals is expected to generate 1.44 times less return on investment than Meridian Mining. In addition to that, Founders Metals is 1.29 times more volatile than Meridian Mining UK. It trades about 0.12 of its total potential returns per unit of risk. Meridian Mining UK is currently generating about 0.22 per unit of volatility. If you would invest 62.00 in Meridian Mining UK on August 19, 2025 and sell it today you would earn a total of 36.00 from holding Meridian Mining UK or generate 58.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Founders Metals vs. Meridian Mining UK
Performance |
| Timeline |
| Founders Metals |
| Meridian Mining UK |
Founders Metals and Meridian Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Founders Metals and Meridian Mining
The main advantage of trading using opposite Founders Metals and Meridian Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Founders Metals position performs unexpectedly, Meridian 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 Meridian Mining will offset losses from the drop in Meridian Mining's long position.| Founders Metals vs. Sitka Gold Corp | Founders Metals vs. Anglo Asian Mining | Founders Metals vs. First Mining Gold | Founders Metals vs. Thesis Gold |
| Meridian Mining vs. ioneer | Meridian Mining vs. Ecora Resources PLC | Meridian Mining vs. Lotus Resources Limited | Meridian Mining vs. Benz Mining Corp |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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