Correlation Between Gaztransport and First
Can any of the company-specific risk be diversified away by investing in both Gaztransport and First 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 Gaztransport and First into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport et Technigaz and First Class Metals, you can compare the effects of market volatilities on Gaztransport and First 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 Gaztransport with a short position of First. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport and First.
Diversification Opportunities for Gaztransport and First
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Gaztransport and First is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport et Technigaz and First Class Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Class Metals and Gaztransport 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 Gaztransport et Technigaz are associated (or correlated) with First. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Class Metals has no effect on the direction of Gaztransport i.e., Gaztransport and First go up and down completely randomly.
Pair Corralation between Gaztransport and First
Assuming the 90 days trading horizon Gaztransport et Technigaz is expected to generate 0.42 times more return on investment than First. However, Gaztransport et Technigaz is 2.39 times less risky than First. It trades about 0.21 of its potential returns per unit of risk. First Class Metals is currently generating about -0.25 per unit of risk. If you would invest 13,300 in Gaztransport et Technigaz on October 11, 2024 and sell it today you would earn a total of 870.00 from holding Gaztransport et Technigaz or generate 6.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport et Technigaz vs. First Class Metals
Performance |
| Timeline |
| Gaztransport et Technigaz |
| First Class Metals |
Gaztransport and First Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport and First
The main advantage of trading using opposite Gaztransport and First positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport position performs unexpectedly, First 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 First will offset losses from the drop in First's long position.| Gaztransport vs. Caledonia Investments | Gaztransport vs. Livermore Investments Group | Gaztransport vs. Power Metal Resources | Gaztransport vs. Europa Metals |
| First vs. Silvercorp Metals | First vs. Cornish Metals | First vs. Central Asia Metals | First vs. Mineral Financial Investments |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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