Correlation Between Medicalg and GreenX Metals
Can any of the company-specific risk be diversified away by investing in both Medicalg and GreenX 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 Medicalg and GreenX Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Medicalg and GreenX Metals, you can compare the effects of market volatilities on Medicalg and GreenX 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 Medicalg with a short position of GreenX Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medicalg and GreenX Metals.
Diversification Opportunities for Medicalg and GreenX Metals
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Medicalg and GreenX is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Medicalg and GreenX Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GreenX Metals and Medicalg 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 Medicalg are associated (or correlated) with GreenX Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GreenX Metals has no effect on the direction of Medicalg i.e., Medicalg and GreenX Metals go up and down completely randomly.
Pair Corralation between Medicalg and GreenX Metals
Assuming the 90 days trading horizon Medicalg is expected to under-perform the GreenX Metals. In addition to that, Medicalg is 1.48 times more volatile than GreenX Metals. It trades about -0.2 of its total potential returns per unit of risk. GreenX Metals is currently generating about -0.21 per unit of volatility. If you would invest 201.00 in GreenX Metals on August 26, 2024 and sell it today you would lose (25.00) from holding GreenX Metals or give up 12.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Medicalg vs. GreenX Metals
Performance |
| Timeline |
| Medicalg |
| GreenX Metals |
Medicalg and GreenX Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medicalg and GreenX Metals
The main advantage of trading using opposite Medicalg and GreenX Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medicalg position performs unexpectedly, GreenX 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 GreenX Metals will offset losses from the drop in GreenX Metals' long position.| Medicalg vs. PLAYWAY SA | Medicalg vs. Medicofarma Biotech SA | Medicalg vs. Bank Millennium SA | Medicalg vs. New Tech Venture |
| GreenX Metals vs. Jastrzebska Spotka Weglowa | GreenX Metals vs. Asseco Business Solutions | GreenX Metals vs. Detalion Games SA | GreenX Metals vs. Asseco South Eastern |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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