Correlation Between GREENX METALS and Thyssenkrupp
Can any of the company-specific risk be diversified away by investing in both GREENX METALS and Thyssenkrupp 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 Thyssenkrupp 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 thyssenkrupp AG, you can compare the effects of market volatilities on GREENX METALS and Thyssenkrupp 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 Thyssenkrupp. Check out your portfolio center. Please also check ongoing floating volatility patterns of GREENX METALS and Thyssenkrupp.
Diversification Opportunities for GREENX METALS and Thyssenkrupp
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between GREENX and Thyssenkrupp is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding GREENX METALS LTD and thyssenkrupp AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on thyssenkrupp AG 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 Thyssenkrupp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of thyssenkrupp AG has no effect on the direction of GREENX METALS i.e., GREENX METALS and Thyssenkrupp go up and down completely randomly.
Pair Corralation between GREENX METALS and Thyssenkrupp
Assuming the 90 days trading horizon GREENX METALS LTD is expected to under-perform the Thyssenkrupp. In addition to that, GREENX METALS is 1.19 times more volatile than thyssenkrupp AG. It trades about -0.05 of its total potential returns per unit of risk. thyssenkrupp AG is currently generating about 0.26 per unit of volatility. If you would invest 323.00 in thyssenkrupp AG on September 5, 2024 and sell it today you would earn a total of 67.00 from holding thyssenkrupp AG or generate 20.74% 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. thyssenkrupp AG
Performance |
| Timeline |
| GREENX METALS LTD |
| thyssenkrupp AG |
GREENX METALS and Thyssenkrupp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GREENX METALS and Thyssenkrupp
The main advantage of trading using opposite GREENX METALS and Thyssenkrupp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GREENX METALS position performs unexpectedly, Thyssenkrupp 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 Thyssenkrupp will offset losses from the drop in Thyssenkrupp's long position.| GREENX METALS vs. CORONGLRES CDIS101 | GREENX METALS vs. AJ LUCAS GROUP | GREENX METALS vs. Superior Plus Corp | GREENX METALS vs. NMI Holdings |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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