Correlation Between Lundin Mining and Lea Bank
Can any of the company-specific risk be diversified away by investing in both Lundin Mining and Lea Bank 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 Lundin Mining and Lea Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lundin Mining and Lea Bank AB, you can compare the effects of market volatilities on Lundin Mining and Lea Bank 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 Lundin Mining with a short position of Lea Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Mining and Lea Bank.
Diversification Opportunities for Lundin Mining and Lea Bank
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lundin and Lea is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Mining and Lea Bank AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lea Bank AB and Lundin Mining 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 Lundin Mining are associated (or correlated) with Lea Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lea Bank AB has no effect on the direction of Lundin Mining i.e., Lundin Mining and Lea Bank go up and down completely randomly.
Pair Corralation between Lundin Mining and Lea Bank
Assuming the 90 days trading horizon Lundin Mining is expected to generate 1.88 times more return on investment than Lea Bank. However, Lundin Mining is 1.88 times more volatile than Lea Bank AB. It trades about 0.25 of its potential returns per unit of risk. Lea Bank AB is currently generating about 0.22 per unit of risk. If you would invest 11,251 in Lundin Mining on September 3, 2025 and sell it today you would earn a total of 6,159 from holding Lundin Mining or generate 54.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lundin Mining vs. Lea Bank AB
Performance |
| Timeline |
| Lundin Mining |
| Lea Bank AB |
Lundin Mining and Lea Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Mining and Lea Bank
The main advantage of trading using opposite Lundin Mining and Lea Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Mining position performs unexpectedly, Lea Bank 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 Lea Bank will offset losses from the drop in Lea Bank's long position.| Lundin Mining vs. USWE Sports AB | Lundin Mining vs. Lindab International AB | Lundin Mining vs. eEducation Albert AB | Lundin Mining vs. Eniro AB |
| Lea Bank vs. Flowscape Technology AB | Lea Bank vs. Norion Bank | Lea Bank vs. Nordea Bank Abp | Lea Bank vs. Avanza Bank Holding |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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