Correlation Between GALENA MINING and Fukuoka Financial
Can any of the company-specific risk be diversified away by investing in both GALENA MINING and Fukuoka Financial 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 GALENA MINING and Fukuoka Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GALENA MINING LTD and Fukuoka Financial Group, you can compare the effects of market volatilities on GALENA MINING and Fukuoka Financial 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 GALENA MINING with a short position of Fukuoka Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of GALENA MINING and Fukuoka Financial.
Diversification Opportunities for GALENA MINING and Fukuoka Financial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GALENA and Fukuoka is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GALENA MINING LTD and Fukuoka Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fukuoka Financial and GALENA MINING 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 GALENA MINING LTD are associated (or correlated) with Fukuoka Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fukuoka Financial has no effect on the direction of GALENA MINING i.e., GALENA MINING and Fukuoka Financial go up and down completely randomly.
Pair Corralation between GALENA MINING and Fukuoka Financial
Assuming the 90 days horizon GALENA MINING LTD is expected to under-perform the Fukuoka Financial. But the stock apears to be less risky and, when comparing its historical volatility, GALENA MINING LTD is 1.2 times less risky than Fukuoka Financial. The stock trades about -0.06 of its potential returns per unit of risk. The Fukuoka Financial Group is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,180 in Fukuoka Financial Group on September 2, 2024 and sell it today you would earn a total of 420.00 from holding Fukuoka Financial Group or generate 19.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
GALENA MINING LTD vs. Fukuoka Financial Group
Performance |
| Timeline |
| GALENA MINING LTD |
| Fukuoka Financial |
GALENA MINING and Fukuoka Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GALENA MINING and Fukuoka Financial
The main advantage of trading using opposite GALENA MINING and Fukuoka Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GALENA MINING position performs unexpectedly, Fukuoka Financial 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 Fukuoka Financial will offset losses from the drop in Fukuoka Financial's long position.The idea behind GALENA MINING LTD and Fukuoka Financial Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Fukuoka Financial vs. GREENX METALS LTD | Fukuoka Financial vs. GALENA MINING LTD | Fukuoka Financial vs. PennyMac Mortgage Investment | Fukuoka Financial vs. SLR Investment 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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