Correlation Between Globex Mining and Hawkeye Gold
Can any of the company-specific risk be diversified away by investing in both Globex Mining and Hawkeye Gold 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 Hawkeye Gold 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 Hawkeye Gold and, you can compare the effects of market volatilities on Globex Mining and Hawkeye Gold 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 Hawkeye Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globex Mining and Hawkeye Gold.
Diversification Opportunities for Globex Mining and Hawkeye Gold
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Globex and Hawkeye is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Globex Mining Enterprises and Hawkeye Gold and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hawkeye Gold 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 Hawkeye Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hawkeye Gold has no effect on the direction of Globex Mining i.e., Globex Mining and Hawkeye Gold go up and down completely randomly.
Pair Corralation between Globex Mining and Hawkeye Gold
Assuming the 90 days trading horizon Globex Mining Enterprises is expected to generate 0.17 times more return on investment than Hawkeye Gold. However, Globex Mining Enterprises is 6.04 times less risky than Hawkeye Gold. It trades about 0.18 of its potential returns per unit of risk. Hawkeye Gold and is currently generating about 0.01 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 Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Globex Mining Enterprises vs. Hawkeye Gold and
Performance |
| Timeline |
| Globex Mining Enterprises |
| Hawkeye Gold |
Globex Mining and Hawkeye Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Globex Mining and Hawkeye Gold
The main advantage of trading using opposite Globex Mining and Hawkeye Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Globex Mining position performs unexpectedly, Hawkeye Gold 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 Hawkeye Gold will offset losses from the drop in Hawkeye Gold'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 |
| Hawkeye Gold vs. First National Financial | Hawkeye Gold vs. Globex Mining Enterprises | Hawkeye Gold vs. Canso Credit Trust | Hawkeye Gold vs. Millennium Silver Corp |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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