Correlation Between GreenX Metals and Fulcrum Metals
Can any of the company-specific risk be diversified away by investing in both GreenX Metals and Fulcrum 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 Fulcrum 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 Fulcrum Metals PLC, you can compare the effects of market volatilities on GreenX Metals and Fulcrum 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 Fulcrum Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenX Metals and Fulcrum Metals.
Diversification Opportunities for GreenX Metals and Fulcrum Metals
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between GreenX and Fulcrum is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding GreenX Metals and Fulcrum Metals PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fulcrum Metals PLC 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 Fulcrum Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fulcrum Metals PLC has no effect on the direction of GreenX Metals i.e., GreenX Metals and Fulcrum Metals go up and down completely randomly.
Pair Corralation between GreenX Metals and Fulcrum Metals
Assuming the 90 days trading horizon GreenX Metals is expected to generate 1.1 times more return on investment than Fulcrum Metals. However, GreenX Metals is 1.1 times more volatile than Fulcrum Metals PLC. It trades about -0.05 of its potential returns per unit of risk. Fulcrum Metals PLC is currently generating about -0.12 per unit of risk. If you would invest 5,200 in GreenX Metals on August 29, 2024 and sell it today you would lose (1,800) from holding GreenX Metals or give up 34.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.52% |
| Values | Daily Returns |
GreenX Metals vs. Fulcrum Metals PLC
Performance |
| Timeline |
| GreenX Metals |
| Fulcrum Metals PLC |
GreenX Metals and Fulcrum Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GreenX Metals and Fulcrum Metals
The main advantage of trading using opposite GreenX Metals and Fulcrum Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GreenX Metals position performs unexpectedly, Fulcrum 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 Fulcrum Metals will offset losses from the drop in Fulcrum Metals' long position.| GreenX Metals vs. Atalaya Mining | GreenX Metals vs. Central Asia Metals | GreenX Metals vs. Anglo Asian Mining | GreenX Metals vs. Metals Exploration Plc |
| Fulcrum Metals vs. Atalaya Mining | Fulcrum Metals vs. Central Asia Metals | Fulcrum Metals vs. Anglo Asian Mining | Fulcrum Metals vs. Metals Exploration Plc |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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