Correlation Between GALENA MINING and GUDANG GARAM
Can any of the company-specific risk be diversified away by investing in both GALENA MINING and GUDANG GARAM 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 GUDANG GARAM 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 GUDANG GARAM, you can compare the effects of market volatilities on GALENA MINING and GUDANG GARAM 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 GUDANG GARAM. Check out your portfolio center. Please also check ongoing floating volatility patterns of GALENA MINING and GUDANG GARAM.
Diversification Opportunities for GALENA MINING and GUDANG GARAM
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GALENA and GUDANG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GALENA MINING LTD and GUDANG GARAM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GUDANG GARAM 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 GUDANG GARAM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GUDANG GARAM has no effect on the direction of GALENA MINING i.e., GALENA MINING and GUDANG GARAM go up and down completely randomly.
Pair Corralation between GALENA MINING and GUDANG GARAM
Assuming the 90 days horizon GALENA MINING LTD is expected to under-perform the GUDANG GARAM. In addition to that, GALENA MINING is 2.88 times more volatile than GUDANG GARAM. It trades about -0.01 of its total potential returns per unit of risk. GUDANG GARAM is currently generating about -0.02 per unit of volatility. If you would invest 105.00 in GUDANG GARAM on September 3, 2024 and sell it today you would lose (33.00) from holding GUDANG GARAM or give up 31.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
GALENA MINING LTD vs. GUDANG GARAM
Performance |
| Timeline |
| GALENA MINING LTD |
| GUDANG GARAM |
GALENA MINING and GUDANG GARAM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GALENA MINING and GUDANG GARAM
The main advantage of trading using opposite GALENA MINING and GUDANG GARAM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GALENA MINING position performs unexpectedly, GUDANG GARAM 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 GUDANG GARAM will offset losses from the drop in GUDANG GARAM's long position.| GALENA MINING vs. Sekisui Chemical Co | GALENA MINING vs. CHEMICAL INDUSTRIES | GALENA MINING vs. Quaker Chemical | GALENA MINING vs. Citic Telecom International |
| GUDANG GARAM vs. Thai Beverage Public | GUDANG GARAM vs. Cal Maine Foods | GUDANG GARAM vs. Harmony Gold Mining | GUDANG GARAM vs. GALENA MINING LTD |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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