Correlation Between GoldMining and Erste Group
Can any of the company-specific risk be diversified away by investing in both GoldMining and Erste Group 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 GoldMining and Erste Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GoldMining and Erste Group Bank, you can compare the effects of market volatilities on GoldMining and Erste Group 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 GoldMining with a short position of Erste Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of GoldMining and Erste Group.
Diversification Opportunities for GoldMining and Erste Group
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between GoldMining and Erste is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding GoldMining and Erste Group Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Erste Group Bank and GoldMining 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 GoldMining are associated (or correlated) with Erste Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Erste Group Bank has no effect on the direction of GoldMining i.e., GoldMining and Erste Group go up and down completely randomly.
Pair Corralation between GoldMining and Erste Group
Assuming the 90 days trading horizon GoldMining is expected to under-perform the Erste Group. In addition to that, GoldMining is 2.66 times more volatile than Erste Group Bank. It trades about -0.01 of its total potential returns per unit of risk. Erste Group Bank is currently generating about 0.11 per unit of volatility. If you would invest 2,736 in Erste Group Bank on September 24, 2024 and sell it today you would earn a total of 3,139 from holding Erste Group Bank or generate 114.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 38.12% |
| Values | Daily Returns |
GoldMining vs. Erste Group Bank
Performance |
| Timeline |
| GoldMining |
| Erste Group Bank |
GoldMining and Erste Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GoldMining and Erste Group
The main advantage of trading using opposite GoldMining and Erste Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GoldMining position performs unexpectedly, Erste Group 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 Erste Group will offset losses from the drop in Erste Group's long position.| GoldMining vs. Uniper SE | GoldMining vs. Mulberry Group PLC | GoldMining vs. London Security Plc | GoldMining vs. Triad Group PLC |
| Erste Group vs. GoldMining | Erste Group vs. Silver Bullet Data | Erste Group vs. Hochschild Mining plc | Erste Group vs. Beowulf Mining |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |