Correlation Between Galena Mining and Bluescope Steel
Can any of the company-specific risk be diversified away by investing in both Galena Mining and Bluescope Steel 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 Bluescope Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Galena Mining and Bluescope Steel, you can compare the effects of market volatilities on Galena Mining and Bluescope Steel 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 Bluescope Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galena Mining and Bluescope Steel.
Diversification Opportunities for Galena Mining and Bluescope Steel
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Galena and Bluescope is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Galena Mining and Bluescope Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bluescope Steel 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 Bluescope Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bluescope Steel has no effect on the direction of Galena Mining i.e., Galena Mining and Bluescope Steel go up and down completely randomly.
Pair Corralation between Galena Mining and Bluescope Steel
If you would invest 1,975 in Bluescope Steel on October 17, 2024 and sell it today you would lose (11.00) from holding Bluescope Steel or give up 0.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.32% |
| Values | Daily Returns |
Galena Mining vs. Bluescope Steel
Performance |
| Timeline |
| Galena Mining |
| Bluescope Steel |
Galena Mining and Bluescope Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Galena Mining and Bluescope Steel
The main advantage of trading using opposite Galena Mining and Bluescope Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Galena Mining position performs unexpectedly, Bluescope Steel 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 Bluescope Steel will offset losses from the drop in Bluescope Steel's long position.| Galena Mining vs. Pure Foods Tasmania | Galena Mining vs. EROAD | Galena Mining vs. Australian Strategic Materials | Galena Mining vs. Retail Food Group |
| Bluescope Steel vs. Metro Mining | Bluescope Steel vs. Galena Mining | Bluescope Steel vs. Talisman Mining | Bluescope Steel vs. Hutchison Telecommunications |
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 CEOs Directory module to screen CEOs from public companies around the world.
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