Correlation Between GreenX Metals and EJF Investments
Can any of the company-specific risk be diversified away by investing in both GreenX Metals and EJF Investments 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 EJF Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GreenX Metals and EJF Investments, you can compare the effects of market volatilities on GreenX Metals and EJF Investments 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 EJF Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenX Metals and EJF Investments.
Diversification Opportunities for GreenX Metals and EJF Investments
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GreenX and EJF is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding GreenX Metals and EJF Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EJF Investments 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 EJF Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EJF Investments has no effect on the direction of GreenX Metals i.e., GreenX Metals and EJF Investments go up and down completely randomly.
Pair Corralation between GreenX Metals and EJF Investments
Assuming the 90 days trading horizon GreenX Metals is expected to generate 2.17 times less return on investment than EJF Investments. In addition to that, GreenX Metals is 1.47 times more volatile than EJF Investments. It trades about 0.08 of its total potential returns per unit of risk. EJF Investments is currently generating about 0.26 per unit of volatility. If you would invest 11,750 in EJF Investments on October 11, 2024 and sell it today you would earn a total of 800.00 from holding EJF Investments or generate 6.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GreenX Metals vs. EJF Investments
Performance |
| Timeline |
| GreenX Metals |
| EJF Investments |
GreenX Metals and EJF Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GreenX Metals and EJF Investments
The main advantage of trading using opposite GreenX Metals and EJF Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GreenX Metals position performs unexpectedly, EJF Investments 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 EJF Investments will offset losses from the drop in EJF Investments' long position.| GreenX Metals vs. Cairn Homes PLC | GreenX Metals vs. Software Circle plc | GreenX Metals vs. Polar Capital Technology | GreenX Metals vs. Home Depot |
| EJF Investments vs. Fevertree Drinks Plc | EJF Investments vs. Ecclesiastical Insurance Office | EJF Investments vs. GreenX Metals | EJF Investments vs. Associated British Foods |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |