Correlation Between GREENX METALS and NMI Holdings
Can any of the company-specific risk be diversified away by investing in both GREENX METALS and NMI Holdings 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 GREENX METALS and NMI Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GREENX METALS LTD and NMI Holdings, you can compare the effects of market volatilities on GREENX METALS and NMI Holdings 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 GREENX METALS with a short position of NMI Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of GREENX METALS and NMI Holdings.
Diversification Opportunities for GREENX METALS and NMI Holdings
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GREENX and NMI is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding GREENX METALS LTD and NMI Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NMI Holdings and GREENX 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 GREENX METALS LTD are associated (or correlated) with NMI Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NMI Holdings has no effect on the direction of GREENX METALS i.e., GREENX METALS and NMI Holdings go up and down completely randomly.
Pair Corralation between GREENX METALS and NMI Holdings
Assuming the 90 days trading horizon GREENX METALS LTD is expected to generate 2.09 times more return on investment than NMI Holdings. However, GREENX METALS is 2.09 times more volatile than NMI Holdings. It trades about 0.2 of its potential returns per unit of risk. NMI Holdings is currently generating about 0.19 per unit of risk. If you would invest 41.00 in GREENX METALS LTD on October 31, 2024 and sell it today you would earn a total of 6.00 from holding GREENX METALS LTD or generate 14.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GREENX METALS LTD vs. NMI Holdings
Performance |
| Timeline |
| GREENX METALS LTD |
| NMI Holdings |
GREENX METALS and NMI Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GREENX METALS and NMI Holdings
The main advantage of trading using opposite GREENX METALS and NMI Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GREENX METALS position performs unexpectedly, NMI Holdings 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 NMI Holdings will offset losses from the drop in NMI Holdings' long position.| GREENX METALS vs. DETALION GAMES SA | GREENX METALS vs. China Eastern Airlines | GREENX METALS vs. Nok Airlines PCL | GREENX METALS vs. SOUTHWEST AIRLINES |
| NMI Holdings vs. OPKO HEALTH | NMI Holdings vs. Singapore Telecommunications Limited | NMI Holdings vs. Telecom Argentina SA | NMI Holdings vs. Molina Healthcare |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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