Correlation Between GreenX Metals and Anglo Asian
Can any of the company-specific risk be diversified away by investing in both GreenX Metals and Anglo Asian 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 Anglo Asian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GreenX Metals and Anglo Asian Mining, you can compare the effects of market volatilities on GreenX Metals and Anglo Asian 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 Anglo Asian. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenX Metals and Anglo Asian.
Diversification Opportunities for GreenX Metals and Anglo Asian
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GreenX and Anglo is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding GreenX Metals and Anglo Asian Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anglo Asian Mining 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 Anglo Asian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anglo Asian Mining has no effect on the direction of GreenX Metals i.e., GreenX Metals and Anglo Asian go up and down completely randomly.
Pair Corralation between GreenX Metals and Anglo Asian
Assuming the 90 days trading horizon GreenX Metals is expected to under-perform the Anglo Asian. But the stock apears to be less risky and, when comparing its historical volatility, GreenX Metals is 1.03 times less risky than Anglo Asian. The stock trades about -0.22 of its potential returns per unit of risk. The Anglo Asian Mining is currently generating about -0.12 of returns per unit of risk over similar time horizon. If you would invest 11,000 in Anglo Asian Mining on August 31, 2024 and sell it today you would lose (850.00) from holding Anglo Asian Mining or give up 7.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GreenX Metals vs. Anglo Asian Mining
Performance |
| Timeline |
| GreenX Metals |
| Anglo Asian Mining |
GreenX Metals and Anglo Asian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GreenX Metals and Anglo Asian
The main advantage of trading using opposite GreenX Metals and Anglo Asian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GreenX Metals position performs unexpectedly, Anglo Asian 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 Anglo Asian will offset losses from the drop in Anglo Asian's long position.The idea behind GreenX Metals and Anglo Asian Mining pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Anglo Asian vs. Automatic Data Processing | Anglo Asian vs. Gear4music Plc | Anglo Asian vs. Grieg Seafood | Anglo Asian vs. Extra Space Storage |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |