Correlation Between GALENA MINING and Cogent Communications
Can any of the company-specific risk be diversified away by investing in both GALENA MINING and Cogent Communications 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 Cogent Communications 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 Cogent Communications Holdings, you can compare the effects of market volatilities on GALENA MINING and Cogent Communications 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 Cogent Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of GALENA MINING and Cogent Communications.
Diversification Opportunities for GALENA MINING and Cogent Communications
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GALENA and Cogent is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GALENA MINING LTD and Cogent Communications Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cogent Communications 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 Cogent Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cogent Communications has no effect on the direction of GALENA MINING i.e., GALENA MINING and Cogent Communications go up and down completely randomly.
Pair Corralation between GALENA MINING and Cogent Communications
Assuming the 90 days horizon GALENA MINING LTD is expected to under-perform the Cogent Communications. In addition to that, GALENA MINING is 2.93 times more volatile than Cogent Communications Holdings. It trades about -0.01 of its total potential returns per unit of risk. Cogent Communications Holdings is currently generating about 0.05 per unit of volatility. If you would invest 5,736 in Cogent Communications Holdings on September 3, 2024 and sell it today you would earn a total of 1,964 from holding Cogent Communications Holdings or generate 34.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.68% |
| Values | Daily Returns |
GALENA MINING LTD vs. Cogent Communications Holdings
Performance |
| Timeline |
| GALENA MINING LTD |
| Cogent Communications |
GALENA MINING and Cogent Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GALENA MINING and Cogent Communications
The main advantage of trading using opposite GALENA MINING and Cogent Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GALENA MINING position performs unexpectedly, Cogent Communications 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 Cogent Communications will offset losses from the drop in Cogent Communications' long position.| GALENA MINING vs. Sekisui Chemical Co | GALENA MINING vs. CHEMICAL INDUSTRIES | GALENA MINING vs. Quaker Chemical | GALENA MINING vs. Citic Telecom International |
| Cogent Communications vs. T Mobile | Cogent Communications vs. China Mobile Limited | Cogent Communications vs. ATT Inc | Cogent Communications vs. Nippon Telegraph and |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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