Correlation Between Focus Graphite and GR Silver
Can any of the company-specific risk be diversified away by investing in both Focus Graphite and GR Silver 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 Focus Graphite and GR Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Focus Graphite and GR Silver Mining, you can compare the effects of market volatilities on Focus Graphite and GR Silver 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 Focus Graphite with a short position of GR Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Focus Graphite and GR Silver.
Diversification Opportunities for Focus Graphite and GR Silver
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Focus and GRSLF is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Focus Graphite and GR Silver Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GR Silver Mining and Focus Graphite 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 Focus Graphite are associated (or correlated) with GR Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GR Silver Mining has no effect on the direction of Focus Graphite i.e., Focus Graphite and GR Silver go up and down completely randomly.
Pair Corralation between Focus Graphite and GR Silver
Assuming the 90 days horizon Focus Graphite is expected to generate 1.4 times more return on investment than GR Silver. However, Focus Graphite is 1.4 times more volatile than GR Silver Mining. It trades about 0.2 of its potential returns per unit of risk. GR Silver Mining is currently generating about 0.12 per unit of risk. If you would invest 5.00 in Focus Graphite on September 14, 2024 and sell it today you would earn a total of 2.00 from holding Focus Graphite or generate 40.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Focus Graphite vs. GR Silver Mining
Performance |
| Timeline |
| Focus Graphite |
| GR Silver Mining |
Focus Graphite and GR Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Focus Graphite and GR Silver
The main advantage of trading using opposite Focus Graphite and GR Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Focus Graphite position performs unexpectedly, GR Silver 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 GR Silver will offset losses from the drop in GR Silver's long position.| Focus Graphite vs. Northern Graphite | Focus Graphite vs. Syrah Resources Limited | Focus Graphite vs. Altura Mining Limited | Focus Graphite vs. Vulcan Minerals |
| GR Silver vs. Qubec Nickel Corp | GR Silver vs. IGO Limited | GR Silver vs. Focus Graphite | GR Silver vs. Mineral Res |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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