Correlation Between Galena Mining and Ramsay Health
Can any of the company-specific risk be diversified away by investing in both Galena Mining and Ramsay Health 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 Ramsay Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Galena Mining and Ramsay Health Care, you can compare the effects of market volatilities on Galena Mining and Ramsay Health 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 Ramsay Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galena Mining and Ramsay Health.
Diversification Opportunities for Galena Mining and Ramsay Health
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Galena and Ramsay is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Galena Mining and Ramsay Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ramsay Health Care 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 Ramsay Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ramsay Health Care has no effect on the direction of Galena Mining i.e., Galena Mining and Ramsay Health go up and down completely randomly.
Pair Corralation between Galena Mining and Ramsay Health
Assuming the 90 days trading horizon Galena Mining is expected to generate 0.77 times more return on investment than Ramsay Health. However, Galena Mining is 1.31 times less risky than Ramsay Health. It trades about -0.09 of its potential returns per unit of risk. Ramsay Health Care is currently generating about -0.07 per unit of risk. If you would invest 7.90 in Galena Mining on September 28, 2024 and sell it today you would lose (2.00) from holding Galena Mining or give up 25.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Galena Mining vs. Ramsay Health Care
Performance |
| Timeline |
| Galena Mining |
| Ramsay Health Care |
Galena Mining and Ramsay Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Galena Mining and Ramsay Health
The main advantage of trading using opposite Galena Mining and Ramsay Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Galena Mining position performs unexpectedly, Ramsay Health 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 Ramsay Health will offset losses from the drop in Ramsay Health's long position.| Galena Mining vs. Northern Star Resources | Galena Mining vs. Evolution Mining | Galena Mining vs. Bluescope Steel | Galena Mining vs. Aneka Tambang Tbk |
| Ramsay Health vs. Aeon Metals | Ramsay Health vs. Hotel Property Investments | Ramsay Health vs. Falcon Metals | Ramsay Health vs. Mayfield Childcare |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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