Correlation Between GALENA MINING and Norwegian Air
Can any of the company-specific risk be diversified away by investing in both GALENA MINING and Norwegian Air 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 Norwegian Air 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 Norwegian Air Shuttle, you can compare the effects of market volatilities on GALENA MINING and Norwegian Air 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 Norwegian Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of GALENA MINING and Norwegian Air.
Diversification Opportunities for GALENA MINING and Norwegian Air
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GALENA and Norwegian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GALENA MINING LTD and Norwegian Air Shuttle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Norwegian Air Shuttle 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 Norwegian Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Norwegian Air Shuttle has no effect on the direction of GALENA MINING i.e., GALENA MINING and Norwegian Air go up and down completely randomly.
Pair Corralation between GALENA MINING and Norwegian Air
Assuming the 90 days horizon GALENA MINING LTD is expected to under-perform the Norwegian Air. In addition to that, GALENA MINING is 2.05 times more volatile than Norwegian Air Shuttle. It trades about -0.01 of its total potential returns per unit of risk. Norwegian Air Shuttle is currently generating about 0.03 per unit of volatility. If you would invest 83.00 in Norwegian Air Shuttle on September 3, 2024 and sell it today you would earn a total of 13.00 from holding Norwegian Air Shuttle or generate 15.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
GALENA MINING LTD vs. Norwegian Air Shuttle
Performance |
| Timeline |
| GALENA MINING LTD |
| Norwegian Air Shuttle |
GALENA MINING and Norwegian Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GALENA MINING and Norwegian Air
The main advantage of trading using opposite GALENA MINING and Norwegian Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GALENA MINING position performs unexpectedly, Norwegian Air 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 Norwegian Air will offset losses from the drop in Norwegian Air'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 |
| Norwegian Air vs. SHIP HEALTHCARE HLDGINC | Norwegian Air vs. GALENA MINING LTD | Norwegian Air vs. Tianjin Capital Environmental | Norwegian Air vs. BlueScope Steel 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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