Correlation Between AEON METALS and Horseshoe Metals

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

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

Diversification Opportunities for AEON METALS and Horseshoe Metals

0.0

Correlation Coefficient

AEON METALS  Horseshoe Metals

Pay attention - limited upside

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

Pair Corralation between AEON METALS and Horseshoe Metals

If you would invest  0.60  in Horseshoe Metals Limited on May 7, 2025 and sell it today you would earn a total of  0.70  from holding Horseshoe Metals Limited or generate 116.67% return on investment over 90 days.

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

AEON METALS LTD  vs.  Horseshoe Metals Limited

AEON METALS LTD

Risk-Adjusted Performance

Very Weak

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

Horseshoe Metals

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Horseshoe Metals Limited are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Horseshoe Metals unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AEON METALS and Horseshoe Metals

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

The idea behind AEON METALS LTD and Horseshoe Metals Limited 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.