Correlation Between GreenX Metals and Strickland Metals
Can any of the company-specific risk be diversified away by investing in both GreenX Metals and Strickland Metals 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 Strickland Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GreenX Metals and Strickland Metals, you can compare the effects of market volatilities on GreenX Metals and Strickland Metals 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 Strickland Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenX Metals and Strickland Metals.
Diversification Opportunities for GreenX Metals and Strickland Metals
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GreenX and Strickland is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding GreenX Metals and Strickland Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strickland Metals 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 Strickland Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strickland Metals has no effect on the direction of GreenX Metals i.e., GreenX Metals and Strickland Metals go up and down completely randomly.
Pair Corralation between GreenX Metals and Strickland Metals
Assuming the 90 days trading horizon GreenX Metals is expected to generate 0.87 times more return on investment than Strickland Metals. However, GreenX Metals is 1.14 times less risky than Strickland Metals. It trades about -0.02 of its potential returns per unit of risk. Strickland Metals is currently generating about -0.1 per unit of risk. If you would invest 67.00 in GreenX Metals on August 29, 2024 and sell it today you would lose (4.00) from holding GreenX Metals or give up 5.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GreenX Metals vs. Strickland Metals
Performance |
| Timeline |
| GreenX Metals |
| Strickland Metals |
GreenX Metals and Strickland Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GreenX Metals and Strickland Metals
The main advantage of trading using opposite GreenX Metals and Strickland Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GreenX Metals position performs unexpectedly, Strickland Metals 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 Strickland Metals will offset losses from the drop in Strickland Metals' long position.| GreenX Metals vs. National Storage REIT | GreenX Metals vs. Red Hill Iron | GreenX Metals vs. Hawsons Iron | GreenX Metals vs. Seven West Media |
| Strickland Metals vs. Northern Star Resources | Strickland Metals vs. Evolution Mining | Strickland Metals vs. Bluescope Steel | Strickland Metals 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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