Correlation Between GreenX Metals and European Metals
Can any of the company-specific risk be diversified away by investing in both GreenX Metals and European 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 European 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 European Metals Holdings, you can compare the effects of market volatilities on GreenX Metals and European 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 European Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenX Metals and European Metals.
Diversification Opportunities for GreenX Metals and European Metals
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GreenX and European is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding GreenX Metals and European Metals Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on European Metals Holdings 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 European Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of European Metals Holdings has no effect on the direction of GreenX Metals i.e., GreenX Metals and European Metals go up and down completely randomly.
Pair Corralation between GreenX Metals and European Metals
Assuming the 90 days trading horizon GreenX Metals is expected to generate 0.57 times more return on investment than European Metals. However, GreenX Metals is 1.76 times less risky than European Metals. It trades about 0.41 of its potential returns per unit of risk. European Metals Holdings is currently generating about 0.1 per unit of risk. If you would invest 3,400 in GreenX Metals on November 1, 2024 and sell it today you would earn a total of 650.00 from holding GreenX Metals or generate 19.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GreenX Metals vs. European Metals Holdings
Performance |
| Timeline |
| GreenX Metals |
| European Metals Holdings |
GreenX Metals and European Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GreenX Metals and European Metals
The main advantage of trading using opposite GreenX Metals and European Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GreenX Metals position performs unexpectedly, European 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 European Metals will offset losses from the drop in European Metals' long position.| GreenX Metals vs. Worldwide Healthcare Trust | GreenX Metals vs. Target Healthcare REIT | GreenX Metals vs. Naturhouse Health SA | GreenX Metals vs. PureTech Health plc |
| European Metals vs. Infrastrutture Wireless Italiane | European Metals vs. Golden Metal Resources | European Metals vs. Host Hotels Resorts | European Metals vs. GreenX Metals |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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