Correlation Between COLUMBIA SPORTSWEAR and GREENX METALS
Can any of the company-specific risk be diversified away by investing in both COLUMBIA SPORTSWEAR and GREENX METALS 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 COLUMBIA SPORTSWEAR and GREENX METALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COLUMBIA SPORTSWEAR and GREENX METALS LTD, you can compare the effects of market volatilities on COLUMBIA SPORTSWEAR and GREENX METALS 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 COLUMBIA SPORTSWEAR with a short position of GREENX METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of COLUMBIA SPORTSWEAR and GREENX METALS.
Diversification Opportunities for COLUMBIA SPORTSWEAR and GREENX METALS
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between COLUMBIA and GREENX is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding COLUMBIA SPORTSWEAR and GREENX METALS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GREENX METALS LTD and COLUMBIA SPORTSWEAR 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 COLUMBIA SPORTSWEAR are associated (or correlated) with GREENX METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GREENX METALS LTD has no effect on the direction of COLUMBIA SPORTSWEAR i.e., COLUMBIA SPORTSWEAR and GREENX METALS go up and down completely randomly.
Pair Corralation between COLUMBIA SPORTSWEAR and GREENX METALS
Assuming the 90 days trading horizon COLUMBIA SPORTSWEAR is expected to generate 11.17 times less return on investment than GREENX METALS. But when comparing it to its historical volatility, COLUMBIA SPORTSWEAR is 3.55 times less risky than GREENX METALS. It trades about 0.01 of its potential returns per unit of risk. GREENX METALS LTD is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 35.00 in GREENX METALS LTD on September 2, 2024 and sell it today you would earn a total of 4.00 from holding GREENX METALS LTD or generate 11.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COLUMBIA SPORTSWEAR vs. GREENX METALS LTD
Performance |
| Timeline |
| COLUMBIA SPORTSWEAR |
| GREENX METALS LTD |
COLUMBIA SPORTSWEAR and GREENX METALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COLUMBIA SPORTSWEAR and GREENX METALS
The main advantage of trading using opposite COLUMBIA SPORTSWEAR and GREENX METALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COLUMBIA SPORTSWEAR position performs unexpectedly, GREENX METALS 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 GREENX METALS will offset losses from the drop in GREENX METALS's long position.| COLUMBIA SPORTSWEAR vs. SIVERS SEMICONDUCTORS AB | COLUMBIA SPORTSWEAR vs. Darden Restaurants | COLUMBIA SPORTSWEAR vs. Reliance Steel Aluminum | COLUMBIA SPORTSWEAR vs. Q2M Managementberatung AG |
| GREENX METALS vs. Superior Plus Corp | GREENX METALS vs. NMI Holdings | GREENX METALS vs. Origin Agritech | GREENX METALS vs. SIVERS SEMICONDUCTORS AB |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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