Correlation Between Ameren Corp and GoldMining
Can any of the company-specific risk be diversified away by investing in both Ameren Corp and GoldMining 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 Ameren Corp and GoldMining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameren Corp and GoldMining, you can compare the effects of market volatilities on Ameren Corp and GoldMining 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 Ameren Corp with a short position of GoldMining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameren Corp and GoldMining.
Diversification Opportunities for Ameren Corp and GoldMining
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ameren and GoldMining is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Ameren Corp and GoldMining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GoldMining and Ameren Corp 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 Ameren Corp are associated (or correlated) with GoldMining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GoldMining has no effect on the direction of Ameren Corp i.e., Ameren Corp and GoldMining go up and down completely randomly.
Pair Corralation between Ameren Corp and GoldMining
Assuming the 90 days trading horizon Ameren Corp is expected to generate 0.48 times more return on investment than GoldMining. However, Ameren Corp is 2.07 times less risky than GoldMining. It trades about 0.39 of its potential returns per unit of risk. GoldMining is currently generating about 0.01 per unit of risk. If you would invest 8,919 in Ameren Corp on October 24, 2024 and sell it today you would earn a total of 751.00 from holding Ameren Corp or generate 8.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 64.71% |
| Values | Daily Returns |
Ameren Corp vs. GoldMining
Performance |
| Timeline |
| Ameren Corp |
| GoldMining |
Ameren Corp and GoldMining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ameren Corp and GoldMining
The main advantage of trading using opposite Ameren Corp and GoldMining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameren Corp position performs unexpectedly, GoldMining 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 GoldMining will offset losses from the drop in GoldMining's long position.| Ameren Corp vs. Home Depot | Ameren Corp vs. Weiss Korea Opportunity | Ameren Corp vs. River and Mercantile | Ameren Corp vs. Chrysalis Investments |
| GoldMining vs. Smithson Investment Trust | GoldMining vs. Tatton Asset Management | GoldMining vs. Schroders Investment Trusts | GoldMining vs. Universal Display Corp |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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