Correlation Between Galena Mining and Bank of Queensland
Can any of the company-specific risk be diversified away by investing in both Galena Mining and Bank of Queensland 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 Galena Mining and Bank of Queensland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Galena Mining and Bank of Queensland, you can compare the effects of market volatilities on Galena Mining and Bank of Queensland 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 Galena Mining with a short position of Bank of Queensland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galena Mining and Bank of Queensland.
Diversification Opportunities for Galena Mining and Bank of Queensland
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Galena and Bank is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Galena Mining and Bank of Queensland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Queensland and Galena Mining 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 Galena Mining are associated (or correlated) with Bank of Queensland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Queensland has no effect on the direction of Galena Mining i.e., Galena Mining and Bank of Queensland go up and down completely randomly.
Pair Corralation between Galena Mining and Bank of Queensland
Assuming the 90 days trading horizon Galena Mining is expected to under-perform the Bank of Queensland. In addition to that, Galena Mining is 7.47 times more volatile than Bank of Queensland. It trades about -0.06 of its total potential returns per unit of risk. Bank of Queensland is currently generating about 0.06 per unit of volatility. If you would invest 9,550 in Bank of Queensland on September 12, 2024 and sell it today you would earn a total of 751.00 from holding Bank of Queensland or generate 7.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Galena Mining vs. Bank of Queensland
Performance |
| Timeline |
| Galena Mining |
| Bank of Queensland |
Galena Mining and Bank of Queensland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Galena Mining and Bank of Queensland
The main advantage of trading using opposite Galena Mining and Bank of Queensland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Galena Mining position performs unexpectedly, Bank of Queensland 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 Bank of Queensland will offset losses from the drop in Bank of Queensland's long position.| Galena Mining vs. Northern Star Resources | Galena Mining vs. Evolution Mining | Galena Mining vs. Bluescope Steel | Galena Mining vs. Sandfire Resources NL |
| Bank of Queensland vs. Premier Investments | Bank of Queensland vs. Aspire Mining | Bank of Queensland vs. Galena Mining | Bank of Queensland vs. Hotel Property Investments |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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