Correlation Between Glen Eagle and Defense Metals
Can any of the company-specific risk be diversified away by investing in both Glen Eagle and Defense Metals 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 Glen Eagle and Defense Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glen Eagle Resources and Defense Metals Corp, you can compare the effects of market volatilities on Glen Eagle and Defense Metals 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 Glen Eagle with a short position of Defense Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glen Eagle and Defense Metals.
Diversification Opportunities for Glen Eagle and Defense Metals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Glen and Defense is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Glen Eagle Resources and Defense Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Defense Metals Corp and Glen Eagle 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 Glen Eagle Resources are associated (or correlated) with Defense Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Defense Metals Corp has no effect on the direction of Glen Eagle i.e., Glen Eagle and Defense Metals go up and down completely randomly.
Pair Corralation between Glen Eagle and Defense Metals
If you would invest 7.20 in Defense Metals Corp on August 25, 2024 and sell it today you would lose (0.05) from holding Defense Metals Corp or give up 0.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Glen Eagle Resources vs. Defense Metals Corp
Performance |
| Timeline |
| Glen Eagle Resources |
| Defense Metals Corp |
Glen Eagle and Defense Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Glen Eagle and Defense Metals
The main advantage of trading using opposite Glen Eagle and Defense Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glen Eagle position performs unexpectedly, Defense Metals 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 Defense Metals will offset losses from the drop in Defense Metals' long position.| Glen Eagle vs. CAT Strategic Metals | Glen Eagle vs. Grizzly Discoveries | Glen Eagle vs. Silver Dollar Resources | Glen Eagle vs. Defense Metals Corp |
| Defense Metals vs. Edison Cobalt Corp | Defense Metals vs. Baroyeca Gold Silver | Defense Metals vs. Aurelia Metals Limited | Defense Metals vs. China Rare Earth |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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