Correlation Between Genuit Group and Wheaton Precious

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

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

Diversification Opportunities for Genuit Group and Wheaton Precious

-0.06

Correlation Coefficient

Genuit Group  Wheaton Precious

Good diversification

The 3 months correlation between Genuit and Wheaton is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Genuit Group plc and Wheaton Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wheaton Precious Metals and Genuit 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 Genuit Group plc are associated (or correlated) with Wheaton Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wheaton Precious Metals has no effect on the direction of Genuit Group i.e., Genuit Group and Wheaton Precious go up and down completely randomly.

Pair Corralation between Genuit Group and Wheaton Precious

Assuming the 90 days trading horizon Genuit Group plc is expected to under-perform the Wheaton Precious. But the stock apears to be less risky and, when comparing its historical volatility, Genuit Group plc is 1.39 times less risky than Wheaton Precious. The stock trades about -0.15 of its potential returns per unit of risk. The Wheaton Precious Metals is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  471,490  in Wheaton Precious Metals on September 13, 2024 and sell it today you would earn a total of  25,010  from holding Wheaton Precious Metals or generate 5.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Genuit Group plc  vs.  Wheaton Precious Metals

Genuit Group plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Genuit Group plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Wheaton Precious Metals

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Wheaton Precious Metals are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting technical and fundamental indicators, Wheaton Precious may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Genuit Group and Wheaton Precious

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

The idea behind Genuit Group plc and Wheaton Precious 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..