Correlation Between Rightmove Plc and Sumitomo Metal

Can any of the company-specific risk be diversified away by investing in both Rightmove Plc and Sumitomo Metal 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 Rightmove Plc and Sumitomo Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Rightmove Plc and Sumitomo Metal

-0.94

Correlation Coefficient

Rightmove Plc  Sumitomo Metal

Pay attention - limited upside

The 3 months correlation between Rightmove and Sumitomo is -0.94. Overlapping area represents the amount of risk that can be diversified away by holding Rightmove Plc and Sumitomo Metal Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sumitomo Metal Mining and Rightmove Plc 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 Rightmove Plc are associated (or correlated) with Sumitomo Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sumitomo Metal Mining has no effect on the direction of Rightmove Plc i.e., Rightmove Plc and Sumitomo Metal go up and down completely randomly.

Pair Corralation between Rightmove Plc and Sumitomo Metal

Assuming the 90 days horizon Rightmove Plc is expected to under-perform the Sumitomo Metal. But the pink sheet apears to be less risky and, when comparing its historical volatility, Rightmove Plc is 2.13 times less risky than Sumitomo Metal. The pink sheet trades about -0.25 of its potential returns per unit of risk. The Sumitomo Metal Mining is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  589.00  in Sumitomo Metal Mining on August 5, 2025 and sell it today you would earn a total of  228.00  from holding Sumitomo Metal Mining or generate 38.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Rightmove Plc  vs.  Sumitomo Metal Mining

Rightmove Plc

Risk-Adjusted Performance

Weakest

Over the last 90 days Rightmove Plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in December 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Sumitomo Metal Mining

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Sumitomo Metal Mining are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Sumitomo Metal showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Rightmove Plc and Sumitomo Metal

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

The idea behind Rightmove Plc and Sumitomo Metal Mining 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.