Correlation Between Global Health and Black Rock
Can any of the company-specific risk be diversified away by investing in both Global Health and Black Rock 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 Global Health and Black Rock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Health and Black Rock Mining, you can compare the effects of market volatilities on Global Health and Black Rock 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 Global Health with a short position of Black Rock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Health and Black Rock.
Diversification Opportunities for Global Health and Black Rock
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Black is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Global Health and Black Rock Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Black Rock Mining and Global Health 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 Global Health are associated (or correlated) with Black Rock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Black Rock Mining has no effect on the direction of Global Health i.e., Global Health and Black Rock go up and down completely randomly.
Pair Corralation between Global Health and Black Rock
Assuming the 90 days trading horizon Global Health is expected to generate 0.68 times more return on investment than Black Rock. However, Global Health is 1.48 times less risky than Black Rock. It trades about 0.02 of its potential returns per unit of risk. Black Rock Mining is currently generating about -0.24 per unit of risk. If you would invest 14.00 in Global Health on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Global Health or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Health vs. Black Rock Mining
Performance |
| Timeline |
| Global Health |
| Black Rock Mining |
Global Health and Black Rock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Health and Black Rock
The main advantage of trading using opposite Global Health and Black Rock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Health position performs unexpectedly, Black Rock 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 Black Rock will offset losses from the drop in Black Rock's long position.| Global Health vs. Alto Metals | Global Health vs. Ras Technology Holdings | Global Health vs. Ainsworth Game Technology | Global Health vs. Aurelia Metals |
| Black Rock vs. Northern Star Resources | Black Rock vs. Evolution Mining | Black Rock vs. Bluescope Steel | Black Rock vs. Sandfire Resources NL |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |