Correlation Between Metals Exploration and St Galler
Can any of the company-specific risk be diversified away by investing in both Metals Exploration and St Galler 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 Metals Exploration and St Galler into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metals Exploration Plc and St Galler Kantonalbank, you can compare the effects of market volatilities on Metals Exploration and St Galler 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 Metals Exploration with a short position of St Galler. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metals Exploration and St Galler.
Diversification Opportunities for Metals Exploration and St Galler
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Metals and 0QQZ is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Metals Exploration Plc and St Galler Kantonalbank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on St Galler Kantonalbank and Metals Exploration 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 Metals Exploration Plc are associated (or correlated) with St Galler. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of St Galler Kantonalbank has no effect on the direction of Metals Exploration i.e., Metals Exploration and St Galler go up and down completely randomly.
Pair Corralation between Metals Exploration and St Galler
Assuming the 90 days trading horizon Metals Exploration Plc is expected to under-perform the St Galler. In addition to that, Metals Exploration is 4.56 times more volatile than St Galler Kantonalbank. It trades about -0.17 of its total potential returns per unit of risk. St Galler Kantonalbank is currently generating about 0.23 per unit of volatility. If you would invest 42,200 in St Galler Kantonalbank on September 5, 2024 and sell it today you would earn a total of 1,450 from holding St Galler Kantonalbank or generate 3.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metals Exploration Plc vs. St Galler Kantonalbank
Performance |
| Timeline |
| Metals Exploration Plc |
| St Galler Kantonalbank |
Metals Exploration and St Galler Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metals Exploration and St Galler
The main advantage of trading using opposite Metals Exploration and St Galler positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metals Exploration position performs unexpectedly, St Galler 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 St Galler will offset losses from the drop in St Galler's long position.| Metals Exploration vs. Givaudan SA | Metals Exploration vs. Antofagasta PLC | Metals Exploration vs. Atalaya Mining | Metals Exploration vs. Ferrexpo PLC |
| St Galler vs. Southern Copper Corp | St Galler vs. Metals Exploration Plc | St Galler vs. AMG Advanced Metallurgical | St Galler vs. Neometals |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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