Correlation Between METHODE ELECTRONICS and GALENA MINING
Can any of the company-specific risk be diversified away by investing in both METHODE ELECTRONICS and GALENA MINING 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 METHODE ELECTRONICS and GALENA MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between METHODE ELECTRONICS and GALENA MINING LTD, you can compare the effects of market volatilities on METHODE ELECTRONICS and GALENA MINING 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 METHODE ELECTRONICS with a short position of GALENA MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of METHODE ELECTRONICS and GALENA MINING.
Diversification Opportunities for METHODE ELECTRONICS and GALENA MINING
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between METHODE and GALENA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding METHODE ELECTRONICS and GALENA MINING LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GALENA MINING LTD and METHODE ELECTRONICS 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 METHODE ELECTRONICS are associated (or correlated) with GALENA MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GALENA MINING LTD has no effect on the direction of METHODE ELECTRONICS i.e., METHODE ELECTRONICS and GALENA MINING go up and down completely randomly.
Pair Corralation between METHODE ELECTRONICS and GALENA MINING
If you would invest 855.00 in METHODE ELECTRONICS on September 20, 2024 and sell it today you would earn a total of 345.00 from holding METHODE ELECTRONICS or generate 40.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
METHODE ELECTRONICS vs. GALENA MINING LTD
Performance |
| Timeline |
| METHODE ELECTRONICS |
| GALENA MINING LTD |
METHODE ELECTRONICS and GALENA MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with METHODE ELECTRONICS and GALENA MINING
The main advantage of trading using opposite METHODE ELECTRONICS and GALENA MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if METHODE ELECTRONICS position performs unexpectedly, GALENA MINING 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 GALENA MINING will offset losses from the drop in GALENA MINING's long position.| METHODE ELECTRONICS vs. Apple Inc | METHODE ELECTRONICS vs. Apple Inc | METHODE ELECTRONICS vs. Apple Inc | METHODE ELECTRONICS vs. Microsoft |
| GALENA MINING vs. TT Electronics PLC | GALENA MINING vs. MAVEN WIRELESS SWEDEN | GALENA MINING vs. SCOTT TECHNOLOGY | GALENA MINING vs. METHODE ELECTRONICS |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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