Correlation Between Giga Metals and Canada Silver

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Can any of the company-specific risk be diversified away by investing in both Giga Metals and Canada Silver 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 Giga Metals and Canada Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Giga Metals and Canada Silver Cobalt, you can compare the effects of market volatilities on Giga Metals and Canada Silver 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 Giga Metals with a short position of Canada Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Giga Metals and Canada Silver.

Diversification Opportunities for Giga Metals and Canada Silver

0.62
  Correlation Coefficient

Poor diversification

The 3 months correlation between Giga and Canada is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Giga Metals and Canada Silver Cobalt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canada Silver Cobalt and Giga Metals 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 Giga Metals are associated (or correlated) with Canada Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canada Silver Cobalt has no effect on the direction of Giga Metals i.e., Giga Metals and Canada Silver go up and down completely randomly.

Pair Corralation between Giga Metals and Canada Silver

If you would invest  28.00  in Canada Silver Cobalt on September 1, 2024 and sell it today you would lose (17.00) from holding Canada Silver Cobalt or give up 60.71% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy0.79%
ValuesDaily Returns

Giga Metals  vs.  Canada Silver Cobalt

 Performance 
       Timeline  
Giga Metals 

Risk-Adjusted Performance

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Strong
Very Weak
Over the last 90 days Giga Metals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward-looking signals, Giga Metals is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
Canada Silver Cobalt 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Canada Silver Cobalt has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Giga Metals and Canada Silver Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Giga Metals and Canada Silver

The main advantage of trading using opposite Giga Metals and Canada Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Giga Metals position performs unexpectedly, Canada Silver 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 Canada Silver will offset losses from the drop in Canada Silver's long position.
The idea behind Giga Metals and Canada Silver Cobalt 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..

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