Correlation Between Glencore PLC and Deep South
Can any of the company-specific risk be diversified away by investing in both Glencore PLC and Deep South 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 Glencore PLC and Deep South into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glencore PLC ADR and Deep South Resources, you can compare the effects of market volatilities on Glencore PLC and Deep South 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 Glencore PLC with a short position of Deep South. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glencore PLC and Deep South.
Diversification Opportunities for Glencore PLC and Deep South
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Glencore and Deep is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Glencore PLC ADR and Deep South Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deep South Resources and Glencore PLC 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 Glencore PLC ADR are associated (or correlated) with Deep South. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deep South Resources has no effect on the direction of Glencore PLC i.e., Glencore PLC and Deep South go up and down completely randomly.
Pair Corralation between Glencore PLC and Deep South
If you would invest 6.00 in Deep South Resources on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Deep South Resources or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Glencore PLC ADR vs. Deep South Resources
Performance |
| Timeline |
| Glencore PLC ADR |
| Deep South Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Glencore PLC and Deep South Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Glencore PLC and Deep South
The main advantage of trading using opposite Glencore PLC and Deep South positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glencore PLC position performs unexpectedly, Deep South 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 Deep South will offset losses from the drop in Deep South's long position.| Glencore PLC vs. ATT Inc | Glencore PLC vs. Merck Company | Glencore PLC vs. Walt Disney | Glencore PLC vs. Caterpillar |
| Deep South vs. Prime Meridian Resources | Deep South vs. Macmahon Holdings Limited | Deep South vs. Hudson Resources | Deep South vs. Rokmaster Resources Corp |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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