Correlation Between GALENA MINING and DAIDO METAL
Can any of the company-specific risk be diversified away by investing in both GALENA MINING and DAIDO METAL 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 DAIDO METAL 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 DAIDO METAL TD, you can compare the effects of market volatilities on GALENA MINING and DAIDO METAL 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 DAIDO METAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of GALENA MINING and DAIDO METAL.
Diversification Opportunities for GALENA MINING and DAIDO METAL
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GALENA and DAIDO is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GALENA MINING LTD and DAIDO METAL TD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAIDO METAL TD 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 DAIDO METAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAIDO METAL TD has no effect on the direction of GALENA MINING i.e., GALENA MINING and DAIDO METAL go up and down completely randomly.
Pair Corralation between GALENA MINING and DAIDO METAL
Assuming the 90 days horizon GALENA MINING LTD is expected to under-perform the DAIDO METAL. But the stock apears to be less risky and, when comparing its historical volatility, GALENA MINING LTD is 1.24 times less risky than DAIDO METAL. The stock trades about -0.02 of its potential returns per unit of risk. The DAIDO METAL TD is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 66.00 in DAIDO METAL TD on October 26, 2024 and sell it today you would earn a total of 222.00 from holding DAIDO METAL TD or generate 336.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GALENA MINING LTD vs. DAIDO METAL TD
Performance |
| Timeline |
| GALENA MINING LTD |
| DAIDO METAL TD |
GALENA MINING and DAIDO METAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GALENA MINING and DAIDO METAL
The main advantage of trading using opposite GALENA MINING and DAIDO METAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GALENA MINING position performs unexpectedly, DAIDO METAL 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 DAIDO METAL will offset losses from the drop in DAIDO METAL's long position.| GALENA MINING vs. Rio Tinto Group | GALENA MINING vs. Anglo American plc | GALENA MINING vs. Mineral Resources Limited | GALENA MINING vs. NEXA RESOURCES SA |
| DAIDO METAL vs. SOUTHWEST AIRLINES | DAIDO METAL vs. MGIC INVESTMENT | DAIDO METAL vs. AEGEAN AIRLINES | DAIDO METAL vs. Guangdong Investment Limited |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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