Correlation Between Globex Mining and Gatos Silver
Can any of the company-specific risk be diversified away by investing in both Globex Mining and Gatos Silver 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 Globex Mining and Gatos Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Globex Mining Enterprises and Gatos Silver, you can compare the effects of market volatilities on Globex Mining and Gatos Silver 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 Globex Mining with a short position of Gatos Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globex Mining and Gatos Silver.
Diversification Opportunities for Globex Mining and Gatos Silver
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Globex and Gatos is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Globex Mining Enterprises and Gatos Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gatos Silver and Globex 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 Globex Mining Enterprises are associated (or correlated) with Gatos Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gatos Silver has no effect on the direction of Globex Mining i.e., Globex Mining and Gatos Silver go up and down completely randomly.
Pair Corralation between Globex Mining and Gatos Silver
Assuming the 90 days trading horizon Globex Mining Enterprises is expected to generate 0.73 times more return on investment than Gatos Silver. However, Globex Mining Enterprises is 1.37 times less risky than Gatos Silver. It trades about 0.18 of its potential returns per unit of risk. Gatos Silver is currently generating about -0.24 per unit of risk. If you would invest 102.00 in Globex Mining Enterprises on September 1, 2024 and sell it today you would earn a total of 9.00 from holding Globex Mining Enterprises or generate 8.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Globex Mining Enterprises vs. Gatos Silver
Performance |
| Timeline |
| Globex Mining Enterprises |
| Gatos Silver |
Globex Mining and Gatos Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Globex Mining and Gatos Silver
The main advantage of trading using opposite Globex Mining and Gatos Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Globex Mining position performs unexpectedly, Gatos Silver 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 Gatos Silver will offset losses from the drop in Gatos Silver's long position.| Globex Mining vs. Chibougamau Independent Mines | Globex Mining vs. Entree Resources | Globex Mining vs. Solitario Exploration Royalty | Globex Mining vs. Forsys Metals Corp |
| Gatos Silver vs. SilverCrest Metals | Gatos Silver vs. Reyna Silver Corp | Gatos Silver vs. New Pacific Metals | Gatos Silver vs. GoGold Resources |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |