Correlation Between AfriTin Mining and HCA Healthcare

Can any of the company-specific risk be diversified away by investing in both AfriTin Mining and HCA Healthcare 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 AfriTin Mining and HCA Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for AfriTin Mining and HCA Healthcare

-0.06

Correlation Coefficient

AfriTin Mining  HCA Healthcare

Good diversification

The 3 months correlation between AfriTin and HCA is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding AfriTin Mining and HCA Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HCA Healthcare and AfriTin 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 AfriTin Mining are associated (or correlated) with HCA Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HCA Healthcare has no effect on the direction of AfriTin Mining i.e., AfriTin Mining and HCA Healthcare go up and down completely randomly.

Pair Corralation between AfriTin Mining and HCA Healthcare

Assuming the 90 days trading horizon AfriTin Mining is expected to generate 1.18 times less return on investment than HCA Healthcare. In addition to that, AfriTin Mining is 2.02 times more volatile than HCA Healthcare. It trades about 0.04 of its total potential returns per unit of risk. HCA Healthcare is currently generating about 0.1 per unit of volatility. If you would invest  32,278  in HCA Healthcare on April 25, 2025 and sell it today you would earn a total of  2,952  from holding HCA Healthcare or generate 9.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

AfriTin Mining  vs.  HCA Healthcare

AfriTin Mining

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in AfriTin Mining are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, AfriTin Mining may actually be approaching a critical reversion point that can send shares even higher in August 2025.

HCA Healthcare

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in HCA Healthcare are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, HCA Healthcare may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with AfriTin Mining and HCA Healthcare

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

The idea behind AfriTin Mining and HCA Healthcare 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.

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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.