Correlation Between Almaden Minerals and Dundee Precious
Can any of the company-specific risk be diversified away by investing in both Almaden Minerals and Dundee Precious 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 Almaden Minerals and Dundee Precious into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Almaden Minerals and Dundee Precious Metals, you can compare the effects of market volatilities on Almaden Minerals and Dundee Precious 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 Almaden Minerals with a short position of Dundee Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of Almaden Minerals and Dundee Precious.
Diversification Opportunities for Almaden Minerals and Dundee Precious
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Almaden and Dundee is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Almaden Minerals and Dundee Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dundee Precious Metals and Almaden Minerals 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 Almaden Minerals are associated (or correlated) with Dundee Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dundee Precious Metals has no effect on the direction of Almaden Minerals i.e., Almaden Minerals and Dundee Precious go up and down completely randomly.
Pair Corralation between Almaden Minerals and Dundee Precious
Considering the 90-day investment horizon Almaden Minerals is expected to under-perform the Dundee Precious. In addition to that, Almaden Minerals is 2.08 times more volatile than Dundee Precious Metals. It trades about -0.07 of its total potential returns per unit of risk. Dundee Precious Metals is currently generating about 0.06 per unit of volatility. If you would invest 580.00 in Dundee Precious Metals on November 2, 2024 and sell it today you would earn a total of 438.00 from holding Dundee Precious Metals or generate 75.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 22.67% |
| Values | Daily Returns |
Almaden Minerals vs. Dundee Precious Metals
Performance |
| Timeline |
| Almaden Minerals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Dundee Precious Metals |
Almaden Minerals and Dundee Precious Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Almaden Minerals and Dundee Precious
The main advantage of trading using opposite Almaden Minerals and Dundee Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Almaden Minerals position performs unexpectedly, Dundee Precious 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 Dundee Precious will offset losses from the drop in Dundee Precious' long position.| Almaden Minerals vs. Antioquia Gold | Almaden Minerals vs. Asante Gold | Almaden Minerals vs. Bluestone Resources | Almaden Minerals vs. Big Ridge Gold |
| Dundee Precious vs. Hummingbird Resources PLC | Dundee Precious vs. Artemis Gold | Dundee Precious vs. Precipitate Gold Corp | Dundee Precious vs. American Eagle Gold |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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