Correlation Between Gaztransport and GreenX Metals

Can any of the company-specific risk be diversified away by investing in both Gaztransport 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 Gaztransport and GreenX Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Gaztransport et Technigaz and GreenX Metals, you can compare the effects of market volatilities on Gaztransport 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 Gaztransport with a short position of GreenX Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport and GreenX Metals.

Diversification Opportunities for Gaztransport and GreenX Metals

0.42

Correlation Coefficient

Gaztransport  GreenX Metals

Very weak diversification

The 3 months correlation between Gaztransport and GreenX is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport et Technigaz and GreenX Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GreenX Metals and Gaztransport 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 Gaztransport et Technigaz 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 Gaztransport i.e., Gaztransport and GreenX Metals go up and down completely randomly.

Pair Corralation between Gaztransport and GreenX Metals

Assuming the 90 days trading horizon Gaztransport is expected to generate 2.18 times less return on investment than GreenX Metals. In addition to that, Gaztransport is 1.25 times more volatile than GreenX Metals. It trades about 0.07 of its total potential returns per unit of risk. GreenX Metals is currently generating about 0.18 per unit of volatility. If you would invest  3,400  in GreenX Metals on December 30, 2024 and sell it today you would earn a total of  900.00  from holding GreenX Metals or generate 26.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Gaztransport et Technigaz  vs.  GreenX Metals

Gaztransport et Technigaz

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Gaztransport et Technigaz are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Gaztransport may actually be approaching a critical reversion point that can send shares even higher in April 2025.

GreenX Metals

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GreenX Metals are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, GreenX Metals exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gaztransport and GreenX Metals

The main advantage of trading using opposite Gaztransport and GreenX Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport 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.

The idea behind Gaztransport et Technigaz and GreenX Metals pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.