Correlation Between Globex Mining and INTER CARS
Can any of the company-specific risk be diversified away by investing in both Globex Mining and INTER CARS 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 Globex Mining and INTER CARS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Globex Mining Enterprises and INTER CARS SA, you can compare the effects of market volatilities on Globex Mining and INTER CARS 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 Globex Mining with a short position of INTER CARS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globex Mining and INTER CARS.
Diversification Opportunities for Globex Mining and INTER CARS
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Globex and INTER is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Globex Mining Enterprises and INTER CARS SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTER CARS SA and Globex 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 Globex Mining Enterprises are associated (or correlated) with INTER CARS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTER CARS SA has no effect on the direction of Globex Mining i.e., Globex Mining and INTER CARS go up and down completely randomly.
Pair Corralation between Globex Mining and INTER CARS
Assuming the 90 days trading horizon Globex Mining Enterprises is expected to generate 1.14 times more return on investment than INTER CARS. However, Globex Mining is 1.14 times more volatile than INTER CARS SA. It trades about 0.51 of its potential returns per unit of risk. INTER CARS SA is currently generating about 0.27 per unit of risk. If you would invest 79.00 in Globex Mining Enterprises on November 2, 2024 and sell it today you would earn a total of 20.00 from holding Globex Mining Enterprises or generate 25.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Globex Mining Enterprises vs. INTER CARS SA
Performance |
| Timeline |
| Globex Mining Enterprises |
| INTER CARS SA |
Globex Mining and INTER CARS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Globex Mining and INTER CARS
The main advantage of trading using opposite Globex Mining and INTER CARS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Globex Mining position performs unexpectedly, INTER CARS 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 INTER CARS will offset losses from the drop in INTER CARS's long position.| Globex Mining vs. Apple Inc | Globex Mining vs. Apple Inc | Globex Mining vs. Apple Inc | Globex Mining vs. Apple Inc |
| INTER CARS vs. Cardinal Health | INTER CARS vs. National Health Investors | INTER CARS vs. Chunghwa Telecom Co | INTER CARS vs. HEALTHSTREAM |
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.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |