Correlation Between Comerica and GreenX Metals
Can any of the company-specific risk be diversified away by investing in both Comerica and GreenX 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 Comerica and GreenX Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Comerica and GreenX Metals, you can compare the effects of market volatilities on Comerica and GreenX 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 Comerica with a short position of GreenX Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comerica and GreenX Metals.
Diversification Opportunities for Comerica and GreenX Metals
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Comerica and GreenX is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Comerica and GreenX Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GreenX Metals and Comerica 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 Comerica are associated (or correlated) with GreenX Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GreenX Metals has no effect on the direction of Comerica i.e., Comerica and GreenX Metals go up and down completely randomly.
Pair Corralation between Comerica and GreenX Metals
Assuming the 90 days trading horizon Comerica is expected to generate 0.38 times more return on investment than GreenX Metals. However, Comerica is 2.65 times less risky than GreenX Metals. It trades about 0.22 of its potential returns per unit of risk. GreenX Metals is currently generating about 0.03 per unit of risk. If you would invest 5,991 in Comerica on August 30, 2024 and sell it today you would earn a total of 1,245 from holding Comerica or generate 20.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.73% |
| Values | Daily Returns |
Comerica vs. GreenX Metals
Performance |
| Timeline |
| Comerica |
| GreenX Metals |
Comerica and GreenX Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comerica and GreenX Metals
The main advantage of trading using opposite Comerica and GreenX Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comerica position performs unexpectedly, GreenX 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 GreenX Metals will offset losses from the drop in GreenX Metals' long position.| Comerica vs. McEwen Mining | Comerica vs. Take Two Interactive Software | Comerica vs. Southern Copper Corp | Comerica vs. Cornish Metals |
| GreenX Metals vs. Givaudan SA | GreenX Metals vs. Antofagasta PLC | GreenX Metals vs. Centamin PLC | GreenX Metals vs. Atalaya Mining |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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