Correlation Between GoldMining and IShares Physical
Can any of the company-specific risk be diversified away by investing in both GoldMining and IShares Physical 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 IShares Physical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GoldMining and iShares Physical Silver, you can compare the effects of market volatilities on GoldMining and IShares Physical 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 IShares Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of GoldMining and IShares Physical.
Diversification Opportunities for GoldMining and IShares Physical
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between GoldMining and IShares is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding GoldMining and iShares Physical Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Physical Silver 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 IShares Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Physical Silver has no effect on the direction of GoldMining i.e., GoldMining and IShares Physical go up and down completely randomly.
Pair Corralation between GoldMining and IShares Physical
Assuming the 90 days trading horizon GoldMining is expected to generate 1.86 times more return on investment than IShares Physical. However, GoldMining is 1.86 times more volatile than iShares Physical Silver. It trades about -0.05 of its potential returns per unit of risk. iShares Physical Silver is currently generating about -0.16 per unit of risk. If you would invest 123.00 in GoldMining on September 1, 2024 and sell it today you would lose (3.00) from holding GoldMining or give up 2.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 59.09% |
| Values | Daily Returns |
GoldMining vs. iShares Physical Silver
Performance |
| Timeline |
| GoldMining |
| iShares Physical Silver |
GoldMining and IShares Physical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GoldMining and IShares Physical
The main advantage of trading using opposite GoldMining and IShares Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GoldMining position performs unexpectedly, IShares Physical 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 IShares Physical will offset losses from the drop in IShares Physical's long position.| GoldMining vs. Greenroc Mining PLC | GoldMining vs. Silvercorp Metals | GoldMining vs. Sydbank | GoldMining vs. AMG Advanced Metallurgical |
| IShares Physical vs. Tungsten West PLC | IShares Physical vs. Hardide PLC | IShares Physical vs. Quantum Blockchain Technologies | IShares Physical vs. Gfinity PLC |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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