Correlation Between GreenX Metals and Andean Silver
Can any of the company-specific risk be diversified away by investing in both GreenX Metals and Andean 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 GreenX Metals and Andean Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GreenX Metals and Andean Silver Limited, you can compare the effects of market volatilities on GreenX Metals and Andean 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 GreenX Metals with a short position of Andean Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenX Metals and Andean Silver.
Diversification Opportunities for GreenX Metals and Andean Silver
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GreenX and Andean is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding GreenX Metals and Andean Silver Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Andean Silver Limited and GreenX 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 GreenX Metals are associated (or correlated) with Andean Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Andean Silver Limited has no effect on the direction of GreenX Metals i.e., GreenX Metals and Andean Silver go up and down completely randomly.
Pair Corralation between GreenX Metals and Andean Silver
Assuming the 90 days trading horizon GreenX Metals is expected to generate 0.67 times more return on investment than Andean Silver. However, GreenX Metals is 1.49 times less risky than Andean Silver. It trades about -0.35 of its potential returns per unit of risk. Andean Silver Limited is currently generating about -0.36 per unit of risk. If you would invest 78.00 in GreenX Metals on August 29, 2024 and sell it today you would lose (15.00) from holding GreenX Metals or give up 19.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GreenX Metals vs. Andean Silver Limited
Performance |
| Timeline |
| GreenX Metals |
| Andean Silver Limited |
GreenX Metals and Andean Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GreenX Metals and Andean Silver
The main advantage of trading using opposite GreenX Metals and Andean Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GreenX Metals position performs unexpectedly, Andean 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 Andean Silver will offset losses from the drop in Andean Silver's long position.| GreenX Metals vs. Flagship Investments | GreenX Metals vs. Metro Mining | GreenX Metals vs. Computershare | GreenX Metals vs. K2 Asset Management |
| Andean Silver vs. Northern Star Resources | Andean Silver vs. Evolution Mining | Andean Silver vs. Bluescope Steel | Andean Silver vs. Sandfire Resources NL |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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