Correlation Between Energy Fuels and Global X
Can any of the company-specific risk be diversified away by investing in both Energy Fuels and Global X 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 Energy Fuels and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energy Fuels and Global X Uranium, you can compare the effects of market volatilities on Energy Fuels and Global X 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 Energy Fuels with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energy Fuels and Global X.
Diversification Opportunities for Energy Fuels and Global X
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Energy and Global is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Energy Fuels and Global X Uranium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Uranium and Energy Fuels 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 Energy Fuels are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X Uranium has no effect on the direction of Energy Fuels i.e., Energy Fuels and Global X go up and down completely randomly.
Pair Corralation between Energy Fuels and Global X
Given the investment horizon of 90 days Energy Fuels is expected to generate 1.83 times more return on investment than Global X. However, Energy Fuels is 1.83 times more volatile than Global X Uranium. It trades about 0.08 of its potential returns per unit of risk. Global X Uranium is currently generating about 0.01 per unit of risk. If you would invest 642.00 in Energy Fuels on August 30, 2024 and sell it today you would earn a total of 38.00 from holding Energy Fuels or generate 5.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Energy Fuels vs. Global X Uranium
Performance |
| Timeline |
| Energy Fuels |
| Global X Uranium |
Energy Fuels and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energy Fuels and Global X
The main advantage of trading using opposite Energy Fuels and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energy Fuels position performs unexpectedly, Global X 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 X will offset losses from the drop in Global X's long position.| Energy Fuels vs. Uranium Energy Corp | Energy Fuels vs. Denison Mines Corp | Energy Fuels vs. Ur Energy | Energy Fuels vs. NexGen Energy |
| Global X vs. Sprott Uranium Miners | Global X vs. Uranium Energy Corp | Global X vs. Cameco Corp | Global X vs. Energy Fuels |
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 CEOs Directory module to screen CEOs from public companies around the world.
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