Correlation Between Graphex Group and Sierra Metals

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

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

Diversification Opportunities for Graphex Group and Sierra Metals

0.0

Correlation Coefficient

Graphex Group  Sierra Metals

Pay attention - limited upside

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

Pair Corralation between Graphex Group and Sierra Metals

If you would invest (100.00) in Sierra Metals on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Sierra Metals or generate -100.0% return on investment over 90 days.

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

Graphex Group Limited  vs.  Sierra Metals

Graphex Group Limited

Risk-Adjusted Performance

Very Weak

Over the last 90 days Graphex Group Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Sierra Metals

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sierra Metals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Sierra Metals is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Graphex Group and Sierra Metals

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

The idea behind Graphex Group Limited and Sierra 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.