Correlation Between GLOBUS MEDICAL-A and MAG SILVER
Can any of the company-specific risk be diversified away by investing in both GLOBUS MEDICAL-A and MAG SILVER 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 GLOBUS MEDICAL-A and MAG SILVER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GLOBUS MEDICAL A and MAG SILVER, you can compare the effects of market volatilities on GLOBUS MEDICAL-A and MAG SILVER 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 GLOBUS MEDICAL-A with a short position of MAG SILVER. Check out your portfolio center. Please also check ongoing floating volatility patterns of GLOBUS MEDICAL-A and MAG SILVER.
Diversification Opportunities for GLOBUS MEDICAL-A and MAG SILVER
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GLOBUS and MAG is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding GLOBUS MEDICAL A and MAG SILVER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAG SILVER and GLOBUS MEDICAL-A 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 GLOBUS MEDICAL A are associated (or correlated) with MAG SILVER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAG SILVER has no effect on the direction of GLOBUS MEDICAL-A i.e., GLOBUS MEDICAL-A and MAG SILVER go up and down completely randomly.
Pair Corralation between GLOBUS MEDICAL-A and MAG SILVER
Assuming the 90 days trading horizon GLOBUS MEDICAL A is expected to generate 0.98 times more return on investment than MAG SILVER. However, GLOBUS MEDICAL A is 1.02 times less risky than MAG SILVER. It trades about 0.28 of its potential returns per unit of risk. MAG SILVER is currently generating about -0.18 per unit of risk. If you would invest 7,850 in GLOBUS MEDICAL A on October 12, 2024 and sell it today you would earn a total of 800.00 from holding GLOBUS MEDICAL A or generate 10.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GLOBUS MEDICAL A vs. MAG SILVER
Performance |
| Timeline |
| GLOBUS MEDICAL A |
| MAG SILVER |
GLOBUS MEDICAL-A and MAG SILVER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GLOBUS MEDICAL-A and MAG SILVER
The main advantage of trading using opposite GLOBUS MEDICAL-A and MAG SILVER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GLOBUS MEDICAL-A position performs unexpectedly, MAG SILVER 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 MAG SILVER will offset losses from the drop in MAG SILVER's long position.| GLOBUS MEDICAL-A vs. SCANSOURCE | GLOBUS MEDICAL-A vs. Digilife Technologies Limited | GLOBUS MEDICAL-A vs. Sunny Optical Technology | GLOBUS MEDICAL-A vs. ScanSource |
| MAG SILVER vs. EVS Broadcast Equipment | MAG SILVER vs. GLOBUS MEDICAL A | MAG SILVER vs. Air Transport Services | MAG SILVER vs. NAGOYA RAILROAD |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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