Correlation Between Intermediate Capital and Greenroc Mining

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

By analyzing existing cross correlation between Intermediate Capital Group and Greenroc Mining PLC, you can compare the effects of market volatilities on Intermediate Capital and Greenroc Mining 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 Intermediate Capital with a short position of Greenroc Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intermediate Capital and Greenroc Mining.

Diversification Opportunities for Intermediate Capital and Greenroc Mining

-0.56

Correlation Coefficient

Intermediate Capital  Greenroc Mining

Excellent diversification

The 3 months correlation between Intermediate and Greenroc is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Intermediate Capital Group and Greenroc Mining PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenroc Mining PLC and Intermediate Capital 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 Intermediate Capital Group are associated (or correlated) with Greenroc Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenroc Mining PLC has no effect on the direction of Intermediate Capital i.e., Intermediate Capital and Greenroc Mining go up and down completely randomly.

Pair Corralation between Intermediate Capital and Greenroc Mining

Assuming the 90 days trading horizon Intermediate Capital is expected to generate 1.25 times less return on investment than Greenroc Mining. But when comparing it to its historical volatility, Intermediate Capital Group is 2.2 times less risky than Greenroc Mining. It trades about 0.06 of its potential returns per unit of risk. Greenroc Mining PLC is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  140.00  in Greenroc Mining PLC on September 5, 2024 and sell it today you would earn a total of  5.00  from holding Greenroc Mining PLC or generate 3.57% return on investment over 90 days.

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

Intermediate Capital Group  vs.  Greenroc Mining PLC

Intermediate Capital

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Intermediate Capital Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Intermediate Capital may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Greenroc Mining PLC

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Greenroc Mining PLC are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Greenroc Mining may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Intermediate Capital and Greenroc Mining

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

The idea behind Intermediate Capital Group and Greenroc Mining 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.

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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.