Correlation Between GALENA MINING and MAGNUM MINING
Can any of the company-specific risk be diversified away by investing in both GALENA MINING and MAGNUM MINING 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 MAGNUM MINING 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 MAGNUM MINING EXP, you can compare the effects of market volatilities on GALENA MINING and MAGNUM MINING 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 MAGNUM MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of GALENA MINING and MAGNUM MINING.
Diversification Opportunities for GALENA MINING and MAGNUM MINING
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between GALENA and MAGNUM is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding GALENA MINING LTD and MAGNUM MINING EXP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAGNUM MINING EXP 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 MAGNUM MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAGNUM MINING EXP has no effect on the direction of GALENA MINING i.e., GALENA MINING and MAGNUM MINING go up and down completely randomly.
Pair Corralation between GALENA MINING and MAGNUM MINING
If you would invest 6.08 in MAGNUM MINING EXP on September 2, 2024 and sell it today you would earn a total of 0.00 from holding MAGNUM MINING EXP or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GALENA MINING LTD vs. MAGNUM MINING EXP
Performance |
| Timeline |
| GALENA MINING LTD |
| MAGNUM MINING EXP |
GALENA MINING and MAGNUM MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GALENA MINING and MAGNUM MINING
The main advantage of trading using opposite GALENA MINING and MAGNUM MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GALENA MINING position performs unexpectedly, MAGNUM MINING 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 MAGNUM MINING will offset losses from the drop in MAGNUM MINING's long position.The idea behind GALENA MINING LTD and MAGNUM MINING EXP 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.| MAGNUM MINING vs. SIVERS SEMICONDUCTORS AB | MAGNUM MINING vs. Darden Restaurants | MAGNUM MINING vs. Reliance Steel Aluminum | MAGNUM MINING vs. Q2M Managementberatung AG |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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