Correlation Between Elmos Semiconductor and Greenroc Mining

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

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

Diversification Opportunities for Elmos Semiconductor and Greenroc Mining

-0.46

Correlation Coefficient

Elmos Semiconductor  Greenroc Mining

Very good diversification

The 3 months correlation between Elmos and Greenroc is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Elmos Semiconductor SE 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 Elmos Semiconductor 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 Elmos Semiconductor SE 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 Elmos Semiconductor i.e., Elmos Semiconductor and Greenroc Mining go up and down completely randomly.

Pair Corralation between Elmos Semiconductor and Greenroc Mining

Assuming the 90 days trading horizon Elmos Semiconductor SE is expected to under-perform the Greenroc Mining. But the stock apears to be less risky and, when comparing its historical volatility, Elmos Semiconductor SE is 1.39 times less risky than Greenroc Mining. The stock trades about -0.11 of its potential returns per unit of risk. The Greenroc Mining PLC is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  135.00  in Greenroc Mining PLC on September 2, 2024 and sell it today you would earn a total of  25.00  from holding Greenroc Mining PLC or generate 18.52% return on investment over 90 days.

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

Elmos Semiconductor SE  vs.  Greenroc Mining PLC

Elmos Semiconductor

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Elmos Semiconductor SE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Greenroc Mining PLC

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Greenroc Mining PLC are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Greenroc Mining unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Elmos Semiconductor and Greenroc Mining

The main advantage of trading using opposite Elmos Semiconductor and Greenroc Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elmos Semiconductor 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 Elmos Semiconductor SE 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.