Correlation Between Adriatic Metals and Granite Creek
Can any of the company-specific risk be diversified away by investing in both Adriatic Metals and Granite Creek 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 Adriatic Metals and Granite Creek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adriatic Metals PLC and Granite Creek Copper, you can compare the effects of market volatilities on Adriatic Metals and Granite Creek 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 Adriatic Metals with a short position of Granite Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adriatic Metals and Granite Creek.
Diversification Opportunities for Adriatic Metals and Granite Creek
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Adriatic and Granite is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Adriatic Metals PLC and Granite Creek Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Granite Creek Copper and Adriatic 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 Adriatic Metals PLC are associated (or correlated) with Granite Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Granite Creek Copper has no effect on the direction of Adriatic Metals i.e., Adriatic Metals and Granite Creek go up and down completely randomly.
Pair Corralation between Adriatic Metals and Granite Creek
Assuming the 90 days horizon Adriatic Metals PLC is expected to generate 0.77 times more return on investment than Granite Creek. However, Adriatic Metals PLC is 1.29 times less risky than Granite Creek. It trades about 0.13 of its potential returns per unit of risk. Granite Creek Copper is currently generating about 0.0 per unit of risk. If you would invest 240.00 in Adriatic Metals PLC on November 7, 2024 and sell it today you would earn a total of 20.00 from holding Adriatic Metals PLC or generate 8.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Adriatic Metals PLC vs. Granite Creek Copper
Performance |
| Timeline |
| Adriatic Metals PLC |
| Granite Creek Copper |
Adriatic Metals and Granite Creek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adriatic Metals and Granite Creek
The main advantage of trading using opposite Adriatic Metals and Granite Creek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adriatic Metals position performs unexpectedly, Granite Creek 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 Granite Creek will offset losses from the drop in Granite Creek's long position.| Adriatic Metals vs. Huntsman Exploration | Adriatic Metals vs. Aurelia Metals Limited | Adriatic Metals vs. American Helium | Adriatic Metals vs. Progressive Planet Solutions |
| Granite Creek vs. Hannan Metals | Granite Creek vs. Atco Mining | Granite Creek vs. Leading Edge Materials | Granite Creek vs. Arianne Phosphate |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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