Correlation Between Greentech Metals and SPDR SPASX
Can any of the company-specific risk be diversified away by investing in both Greentech Metals and SPDR SPASX 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 Greentech Metals and SPDR SPASX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greentech Metals and SPDR SPASX 200, you can compare the effects of market volatilities on Greentech Metals and SPDR SPASX 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 Greentech Metals with a short position of SPDR SPASX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greentech Metals and SPDR SPASX.
Diversification Opportunities for Greentech Metals and SPDR SPASX
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Greentech and SPDR is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Greentech Metals and SPDR SPASX 200 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SPASX 200 and Greentech Metals 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 Greentech Metals are associated (or correlated) with SPDR SPASX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SPASX 200 has no effect on the direction of Greentech Metals i.e., Greentech Metals and SPDR SPASX go up and down completely randomly.
Pair Corralation between Greentech Metals and SPDR SPASX
Assuming the 90 days trading horizon Greentech Metals is expected to under-perform the SPDR SPASX. In addition to that, Greentech Metals is 11.64 times more volatile than SPDR SPASX 200. It trades about -0.18 of its total potential returns per unit of risk. SPDR SPASX 200 is currently generating about 0.34 per unit of volatility. If you would invest 2,582 in SPDR SPASX 200 on September 3, 2024 and sell it today you would earn a total of 117.00 from holding SPDR SPASX 200 or generate 4.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Greentech Metals vs. SPDR SPASX 200
Performance |
| Timeline |
| Greentech Metals |
| SPDR SPASX 200 |
Greentech Metals and SPDR SPASX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greentech Metals and SPDR SPASX
The main advantage of trading using opposite Greentech Metals and SPDR SPASX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greentech Metals position performs unexpectedly, SPDR SPASX 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 SPDR SPASX will offset losses from the drop in SPDR SPASX's long position.| Greentech Metals vs. Northern Star Resources | Greentech Metals vs. Evolution Mining | Greentech Metals vs. Bluescope Steel | Greentech Metals vs. Aneka Tambang Tbk |
| SPDR SPASX vs. SPDR SPASX 200 | SPDR SPASX vs. SPDR SPASX 50 | SPDR SPASX vs. SPDR MSCI World | SPDR SPASX vs. SPDR Dow Jones |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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