Correlation Between GREENX METALS and Selective Insurance
Can any of the company-specific risk be diversified away by investing in both GREENX METALS and Selective Insurance 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 Selective Insurance 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 Selective Insurance Group, you can compare the effects of market volatilities on GREENX METALS and Selective Insurance 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 Selective Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of GREENX METALS and Selective Insurance.
Diversification Opportunities for GREENX METALS and Selective Insurance
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GREENX and Selective is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding GREENX METALS LTD and Selective Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Selective Insurance 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 Selective Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Selective Insurance has no effect on the direction of GREENX METALS i.e., GREENX METALS and Selective Insurance go up and down completely randomly.
Pair Corralation between GREENX METALS and Selective Insurance
Assuming the 90 days trading horizon GREENX METALS is expected to generate 1.35 times less return on investment than Selective Insurance. In addition to that, GREENX METALS is 2.5 times more volatile than Selective Insurance Group. It trades about 0.02 of its total potential returns per unit of risk. Selective Insurance Group is currently generating about 0.08 per unit of volatility. If you would invest 8,167 in Selective Insurance Group on August 25, 2024 and sell it today you would earn a total of 533.00 from holding Selective Insurance Group or generate 6.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GREENX METALS LTD vs. Selective Insurance Group
Performance |
| Timeline |
| GREENX METALS LTD |
| Selective Insurance |
GREENX METALS and Selective Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GREENX METALS and Selective Insurance
The main advantage of trading using opposite GREENX METALS and Selective Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GREENX METALS position performs unexpectedly, Selective Insurance 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 Selective Insurance will offset losses from the drop in Selective Insurance's long position.| GREENX METALS vs. PERENNIAL ENERGY HD 01 | GREENX METALS vs. Superior Plus Corp | GREENX METALS vs. NMI Holdings | GREENX METALS vs. Origin Agritech |
| Selective Insurance vs. Pembina Pipeline Corp | Selective Insurance vs. Merit Medical Systems | Selective Insurance vs. MeVis Medical Solutions | Selective Insurance vs. Clearside Biomedical |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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