Correlation Between Truscott Mining and GreenX Metals
Can any of the company-specific risk be diversified away by investing in both Truscott Mining 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 Truscott Mining and GreenX Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Truscott Mining Corp and GreenX Metals, you can compare the effects of market volatilities on Truscott Mining 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 Truscott Mining with a short position of GreenX Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Truscott Mining and GreenX Metals.
Diversification Opportunities for Truscott Mining and GreenX Metals
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Truscott and GreenX is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Truscott Mining Corp and GreenX Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GreenX Metals and Truscott Mining 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 Truscott Mining Corp 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 Truscott Mining i.e., Truscott Mining and GreenX Metals go up and down completely randomly.
Pair Corralation between Truscott Mining and GreenX Metals
Assuming the 90 days trading horizon Truscott Mining Corp is expected to generate 1.01 times more return on investment than GreenX Metals. However, Truscott Mining is 1.01 times more volatile than GreenX Metals. It trades about 0.05 of its potential returns per unit of risk. GreenX Metals is currently generating about -0.03 per unit of risk. If you would invest 5.40 in Truscott Mining Corp on August 24, 2024 and sell it today you would earn a total of 1.60 from holding Truscott Mining Corp or generate 29.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Truscott Mining Corp vs. GreenX Metals
Performance |
| Timeline |
| Truscott Mining Corp |
| GreenX Metals |
Truscott Mining and GreenX Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Truscott Mining and GreenX Metals
The main advantage of trading using opposite Truscott Mining and GreenX Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Truscott Mining 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.| Truscott Mining vs. Evolution Mining | Truscott Mining vs. Bluescope Steel | Truscott Mining vs. Perseus Mining | Truscott Mining vs. Champion Iron |
| GreenX Metals vs. Evolution Mining | GreenX Metals vs. Bluescope Steel | GreenX Metals vs. Perseus Mining | GreenX Metals vs. Champion Iron |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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