Correlation Between Globex Mining and Triple Flag
Can any of the company-specific risk be diversified away by investing in both Globex Mining and Triple Flag 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 Triple Flag 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 Triple Flag Precious, you can compare the effects of market volatilities on Globex Mining and Triple Flag 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 Triple Flag. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globex Mining and Triple Flag.
Diversification Opportunities for Globex Mining and Triple Flag
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Globex and Triple is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Globex Mining Enterprises and Triple Flag Precious in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triple Flag Precious 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 Triple Flag. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triple Flag Precious has no effect on the direction of Globex Mining i.e., Globex Mining and Triple Flag go up and down completely randomly.
Pair Corralation between Globex Mining and Triple Flag
Assuming the 90 days trading horizon Globex Mining Enterprises is expected to generate 1.33 times more return on investment than Triple Flag. However, Globex Mining is 1.33 times more volatile than Triple Flag Precious. It trades about 0.15 of its potential returns per unit of risk. Triple Flag Precious is currently generating about 0.04 per unit of risk. If you would invest 91.00 in Globex Mining Enterprises on October 25, 2024 and sell it today you would earn a total of 43.00 from holding Globex Mining Enterprises or generate 47.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Globex Mining Enterprises vs. Triple Flag Precious
Performance |
| Timeline |
| Globex Mining Enterprises |
| Triple Flag Precious |
Globex Mining and Triple Flag Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Globex Mining and Triple Flag
The main advantage of trading using opposite Globex Mining and Triple Flag positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Globex Mining position performs unexpectedly, Triple Flag 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 Triple Flag will offset losses from the drop in Triple Flag'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 |
| Triple Flag vs. HOME DEPOT CDR | Triple Flag vs. Champion Gaming Group | Triple Flag vs. Wilmington Capital Management | Triple Flag vs. Calian Technologies |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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