Correlation Between CN MODERN and Americas Gold
Can any of the company-specific risk be diversified away by investing in both CN MODERN and Americas Gold 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 CN MODERN and Americas Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CN MODERN DAIRY and Americas Gold and, you can compare the effects of market volatilities on CN MODERN and Americas Gold 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 CN MODERN with a short position of Americas Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of CN MODERN and Americas Gold.
Diversification Opportunities for CN MODERN and Americas Gold
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 07M and Americas is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding CN MODERN DAIRY and Americas Gold and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Americas Gold and CN MODERN 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 CN MODERN DAIRY are associated (or correlated) with Americas Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Americas Gold has no effect on the direction of CN MODERN i.e., CN MODERN and Americas Gold go up and down completely randomly.
Pair Corralation between CN MODERN and Americas Gold
Assuming the 90 days trading horizon CN MODERN is expected to generate 5.11 times less return on investment than Americas Gold. But when comparing it to its historical volatility, CN MODERN DAIRY is 2.32 times less risky than Americas Gold. It trades about 0.01 of its potential returns per unit of risk. Americas Gold and is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 52.00 in Americas Gold and on October 26, 2024 and sell it today you would lose (2.00) from holding Americas Gold and or give up 3.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CN MODERN DAIRY vs. Americas Gold and
Performance |
| Timeline |
| CN MODERN DAIRY |
| Americas Gold |
CN MODERN and Americas Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CN MODERN and Americas Gold
The main advantage of trading using opposite CN MODERN and Americas Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CN MODERN position performs unexpectedly, Americas Gold 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 Americas Gold will offset losses from the drop in Americas Gold's long position.| CN MODERN vs. Eurasia Mining Plc | CN MODERN vs. Entravision Communications | CN MODERN vs. Iridium Communications | CN MODERN vs. ANGLO ASIAN MINING |
| Americas Gold vs. Daito Trust Construction | Americas Gold vs. FARM 51 GROUP | Americas Gold vs. Major Drilling Group | Americas Gold vs. WIMFARM SA EO |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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