Correlation Between Globe Metals and Invictus Energy
Can any of the company-specific risk be diversified away by investing in both Globe Metals and Invictus Energy 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 Globe Metals and Invictus Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Globe Metals Mining and Invictus Energy, you can compare the effects of market volatilities on Globe Metals and Invictus Energy 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 Globe Metals with a short position of Invictus Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globe Metals and Invictus Energy.
Diversification Opportunities for Globe Metals and Invictus Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Globe and Invictus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Globe Metals Mining and Invictus Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invictus Energy and Globe Metals 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 Globe Metals Mining are associated (or correlated) with Invictus Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invictus Energy has no effect on the direction of Globe Metals i.e., Globe Metals and Invictus Energy go up and down completely randomly.
Pair Corralation between Globe Metals and Invictus Energy
Assuming the 90 days trading horizon Globe Metals Mining is expected to generate 0.74 times more return on investment than Invictus Energy. However, Globe Metals Mining is 1.35 times less risky than Invictus Energy. It trades about 0.01 of its potential returns per unit of risk. Invictus Energy is currently generating about -0.01 per unit of risk. If you would invest 6.31 in Globe Metals Mining on November 9, 2024 and sell it today you would lose (2.91) from holding Globe Metals Mining or give up 46.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 27.51% |
| Values | Daily Returns |
Globe Metals Mining vs. Invictus Energy
Performance |
| Timeline |
| Globe Metals Mining |
| Invictus Energy |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Globe Metals and Invictus Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Globe Metals and Invictus Energy
The main advantage of trading using opposite Globe Metals and Invictus Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Globe Metals position performs unexpectedly, Invictus Energy 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 Invictus Energy will offset losses from the drop in Invictus Energy's long position.| Globe Metals vs. Charter Hall Retail | Globe Metals vs. Super Retail Group | Globe Metals vs. G8 Education | Globe Metals vs. DMC Mining |
| Invictus Energy vs. Microequities Asset Management | Invictus Energy vs. Flagship Investments | Invictus Energy vs. Mirrabooka Investments | Invictus Energy vs. MFF Capital 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |