Correlation Between Challenger and Group 6
Can any of the company-specific risk be diversified away by investing in both Challenger and Group 6 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 Challenger and Group 6 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Challenger and Group 6 Metals, you can compare the effects of market volatilities on Challenger and Group 6 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 Challenger with a short position of Group 6. Check out your portfolio center. Please also check ongoing floating volatility patterns of Challenger and Group 6.
Diversification Opportunities for Challenger and Group 6
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Challenger and Group is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Challenger and Group 6 Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Group 6 Metals and Challenger 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 Challenger are associated (or correlated) with Group 6. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Group 6 Metals has no effect on the direction of Challenger i.e., Challenger and Group 6 go up and down completely randomly.
Pair Corralation between Challenger and Group 6
If you would invest 2.50 in Group 6 Metals on November 30, 2024 and sell it today you would earn a total of 0.00 from holding Group 6 Metals or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Challenger vs. Group 6 Metals
Performance |
| Timeline |
| Challenger |
| Group 6 Metals |
Challenger and Group 6 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Challenger and Group 6
The main advantage of trading using opposite Challenger and Group 6 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Challenger position performs unexpectedly, Group 6 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 Group 6 will offset losses from the drop in Group 6's long position.| Challenger vs. Asian Battery Metals | Challenger vs. Catalyst Metals | Challenger vs. Aeon Metals | Challenger vs. Perseus Mining |
| Group 6 vs. 29Metals | Group 6 vs. Sequoia Financial Group | Group 6 vs. Perseus Mining | Group 6 vs. Liberty Financial Group |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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