Correlation Between Ferroglobe PLC and Global Atomic
Can any of the company-specific risk be diversified away by investing in both Ferroglobe PLC and Global Atomic 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 Ferroglobe PLC and Global Atomic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ferroglobe PLC and Global Atomic Corp, you can compare the effects of market volatilities on Ferroglobe PLC and Global Atomic 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 Ferroglobe PLC with a short position of Global Atomic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ferroglobe PLC and Global Atomic.
Diversification Opportunities for Ferroglobe PLC and Global Atomic
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ferroglobe and Global is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Ferroglobe PLC and Global Atomic Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Atomic Corp and Ferroglobe PLC 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 Ferroglobe PLC are associated (or correlated) with Global Atomic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Atomic Corp has no effect on the direction of Ferroglobe PLC i.e., Ferroglobe PLC and Global Atomic go up and down completely randomly.
Pair Corralation between Ferroglobe PLC and Global Atomic
Considering the 90-day investment horizon Ferroglobe PLC is expected to generate 0.49 times more return on investment than Global Atomic. However, Ferroglobe PLC is 2.03 times less risky than Global Atomic. It trades about -0.07 of its potential returns per unit of risk. Global Atomic Corp is currently generating about -0.09 per unit of risk. If you would invest 601.00 in Ferroglobe PLC on August 25, 2024 and sell it today you would lose (144.00) from holding Ferroglobe PLC or give up 23.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Ferroglobe PLC vs. Global Atomic Corp
Performance |
| Timeline |
| Ferroglobe PLC |
| Global Atomic Corp |
Ferroglobe PLC and Global Atomic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ferroglobe PLC and Global Atomic
The main advantage of trading using opposite Ferroglobe PLC and Global Atomic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ferroglobe PLC position performs unexpectedly, Global Atomic 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 Global Atomic will offset losses from the drop in Global Atomic's long position.| Ferroglobe PLC vs. Vale SA ADR | Ferroglobe PLC vs. Teck Resources Ltd | Ferroglobe PLC vs. MP Materials Corp | Ferroglobe PLC vs. BHP Group Limited |
| Global Atomic vs. NGEx Minerals | Global Atomic vs. Boss Resources | Global Atomic vs. Forum Energy Metals | Global Atomic vs. Kraken Energy Corp |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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