Correlation Between GREENX METALS and PT Steel
Can any of the company-specific risk be diversified away by investing in both GREENX METALS and PT Steel 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 PT Steel 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 PT Steel Pipe, you can compare the effects of market volatilities on GREENX METALS and PT Steel 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 PT Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of GREENX METALS and PT Steel.
Diversification Opportunities for GREENX METALS and PT Steel
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GREENX and S08 is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding GREENX METALS LTD and PT Steel Pipe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Steel Pipe 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 PT Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Steel Pipe has no effect on the direction of GREENX METALS i.e., GREENX METALS and PT Steel go up and down completely randomly.
Pair Corralation between GREENX METALS and PT Steel
Assuming the 90 days trading horizon GREENX METALS LTD is expected to generate 0.31 times more return on investment than PT Steel. However, GREENX METALS LTD is 3.24 times less risky than PT Steel. It trades about 0.11 of its potential returns per unit of risk. PT Steel Pipe is currently generating about -0.02 per unit of risk. If you would invest 41.00 in GREENX METALS LTD on October 10, 2024 and sell it today you would earn a total of 2.00 from holding GREENX METALS LTD or generate 4.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GREENX METALS LTD vs. PT Steel Pipe
Performance |
| Timeline |
| GREENX METALS LTD |
| PT Steel Pipe |
GREENX METALS and PT Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GREENX METALS and PT Steel
The main advantage of trading using opposite GREENX METALS and PT Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GREENX METALS position performs unexpectedly, PT Steel 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 PT Steel will offset losses from the drop in PT Steel's long position.| GREENX METALS vs. Gol Intelligent Airlines | GREENX METALS vs. Astral Foods Limited | GREENX METALS vs. Performance Food Group | GREENX METALS vs. China Eastern Airlines |
| PT Steel vs. Take Two Interactive Software | PT Steel vs. X FAB Silicon Foundries | PT Steel vs. Elmos Semiconductor SE | PT Steel vs. Hua Hong Semiconductor |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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