Correlation Between Precious Metals and Glacier Bancorp

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

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

Diversification Opportunities for Precious Metals and Glacier Bancorp

-0.4

Correlation Coefficient

Precious Metals  Glacier Bancorp

Very good diversification

The 3 months correlation between Precious and Glacier is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Precious Metals And and Glacier Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glacier Bancorp and Precious 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 Precious Metals And are associated (or correlated) with Glacier Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glacier Bancorp has no effect on the direction of Precious Metals i.e., Precious Metals and Glacier Bancorp go up and down completely randomly.

Pair Corralation between Precious Metals and Glacier Bancorp

Assuming the 90 days horizon Precious Metals is expected to generate 1.33 times less return on investment than Glacier Bancorp. But when comparing it to its historical volatility, Precious Metals And is 1.51 times less risky than Glacier Bancorp. It trades about 0.02 of its potential returns per unit of risk. Glacier Bancorp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  4,594  in Glacier Bancorp on October 5, 2024 and sell it today you would earn a total of  372.00  from holding Glacier Bancorp or generate 8.1% return on investment over 90 days.

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

Precious Metals And  vs.  Glacier Bancorp

Precious Metals And

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Precious Metals And has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's primary indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Glacier Bancorp

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Glacier Bancorp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile fundamental indicators, Glacier Bancorp may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Precious Metals and Glacier Bancorp

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

The idea behind Precious Metals And and Glacier Bancorp 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.