Correlation Between GALENA MINING and Caterpillar
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By analyzing existing cross correlation between GALENA MINING LTD and Caterpillar, you can compare the effects of market volatilities on GALENA MINING and Caterpillar 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 Caterpillar. Check out your portfolio center. Please also check ongoing floating volatility patterns of GALENA MINING and Caterpillar.
Diversification Opportunities for GALENA MINING and Caterpillar
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GALENA and Caterpillar is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GALENA MINING LTD and Caterpillar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caterpillar 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 Caterpillar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caterpillar has no effect on the direction of GALENA MINING i.e., GALENA MINING and Caterpillar go up and down completely randomly.
Pair Corralation between GALENA MINING and Caterpillar
Assuming the 90 days horizon GALENA MINING LTD is expected to under-perform the Caterpillar. In addition to that, GALENA MINING is 1.15 times more volatile than Caterpillar. It trades about -0.06 of its total potential returns per unit of risk. Caterpillar is currently generating about 0.13 per unit of volatility. If you would invest 23,492 in Caterpillar on September 2, 2024 and sell it today you would earn a total of 15,258 from holding Caterpillar or generate 64.95% 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. Caterpillar
Performance |
| Timeline |
| GALENA MINING LTD |
| Caterpillar |
GALENA MINING and Caterpillar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GALENA MINING and Caterpillar
The main advantage of trading using opposite GALENA MINING and Caterpillar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GALENA MINING position performs unexpectedly, Caterpillar 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 Caterpillar will offset losses from the drop in Caterpillar's long position.The idea behind GALENA MINING LTD and Caterpillar 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.| Caterpillar vs. BROADSTNET LEADL 00025 | Caterpillar vs. Texas Roadhouse | Caterpillar vs. GALENA MINING LTD | Caterpillar vs. TITANIUM TRANSPORTGROUP |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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