Correlation Between CEIX Old and GCM Resources

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

By analyzing existing cross correlation between CEIX Old and GCM Resources Plc, you can compare the effects of market volatilities on CEIX Old and GCM Resources 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 CEIX Old with a short position of GCM Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of CEIX Old and GCM Resources.

Diversification Opportunities for CEIX Old and GCM Resources

0.0

Correlation Coefficient

CEIX Old  GCM Resources

Pay attention - limited upside

The 3 months correlation between CEIX and GCM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CEIX Old and GCM Resources Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GCM Resources Plc and CEIX Old 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 CEIX Old are associated (or correlated) with GCM Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GCM Resources Plc has no effect on the direction of CEIX Old i.e., CEIX Old and GCM Resources go up and down completely randomly.

Pair Corralation between CEIX Old and GCM Resources

If you would invest  12.00  in GCM Resources Plc on December 27, 2024 and sell it today you would lose (6.00) from holding GCM Resources Plc or give up 50.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

CEIX Old  vs.  GCM Resources Plc

CEIX Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days CEIX Old has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong forward indicators, CEIX Old is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

GCM Resources Plc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in GCM Resources Plc are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady primary indicators, GCM Resources reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CEIX Old and GCM Resources

The main advantage of trading using opposite CEIX Old and GCM Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEIX Old position performs unexpectedly, GCM Resources 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 GCM Resources will offset losses from the drop in GCM Resources' long position.

The idea behind CEIX Old and GCM Resources Plc 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .