Correlation Between Gaztransport Technigaz and Gold Road
Can any of the company-specific risk be diversified away by investing in both Gaztransport Technigaz and Gold Road 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 Gaztransport Technigaz and Gold Road into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport Technigaz SA and Gold Road Resources, you can compare the effects of market volatilities on Gaztransport Technigaz and Gold Road 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 Gaztransport Technigaz with a short position of Gold Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and Gold Road.
Diversification Opportunities for Gaztransport Technigaz and Gold Road
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gaztransport and Gold is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SA and Gold Road Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Road Resources and Gaztransport Technigaz 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 Gaztransport Technigaz SA are associated (or correlated) with Gold Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Road Resources has no effect on the direction of Gaztransport Technigaz i.e., Gaztransport Technigaz and Gold Road go up and down completely randomly.
Pair Corralation between Gaztransport Technigaz and Gold Road
Assuming the 90 days horizon Gaztransport Technigaz is expected to generate 1.54 times less return on investment than Gold Road. In addition to that, Gaztransport Technigaz is 1.75 times more volatile than Gold Road Resources. It trades about 0.37 of its total potential returns per unit of risk. Gold Road Resources is currently generating about 0.99 per unit of volatility. If you would invest 119.00 in Gold Road Resources on October 28, 2024 and sell it today you would earn a total of 29.00 from holding Gold Road Resources or generate 24.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport Technigaz SA vs. Gold Road Resources
Performance |
| Timeline |
| Gaztransport Technigaz |
| Gold Road Resources |
Gaztransport Technigaz and Gold Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport Technigaz and Gold Road
The main advantage of trading using opposite Gaztransport Technigaz and Gold Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport Technigaz position performs unexpectedly, Gold Road 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 Gold Road will offset losses from the drop in Gold Road's long position.| Gaztransport Technigaz vs. ALTAIR RES INC | Gaztransport Technigaz vs. CVW CLEANTECH INC | Gaztransport Technigaz vs. Ryanair Holdings plc | Gaztransport Technigaz vs. Carnegie Clean Energy |
| Gold Road vs. ZIJIN MINH UNSPADR20 | Gold Road vs. Newmont | Gold Road vs. Superior Plus Corp | Gold Road vs. Origin Agritech |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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