Correlation Between Amundi Index and Gold Bullion
Can any of the company-specific risk be diversified away by investing in both Amundi Index and Gold Bullion 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 Amundi Index and Gold Bullion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi Index Solutions and Gold Bullion Securities, you can compare the effects of market volatilities on Amundi Index and Gold Bullion 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 Amundi Index with a short position of Gold Bullion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi Index and Gold Bullion.
Diversification Opportunities for Amundi Index and Gold Bullion
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amundi and Gold is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Amundi Index Solutions and Gold Bullion Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Bullion Securities and Amundi Index 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 Amundi Index Solutions are associated (or correlated) with Gold Bullion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Bullion Securities has no effect on the direction of Amundi Index i.e., Amundi Index and Gold Bullion go up and down completely randomly.
Pair Corralation between Amundi Index and Gold Bullion
Assuming the 90 days trading horizon Amundi Index is expected to generate 4.03 times less return on investment than Gold Bullion. But when comparing it to its historical volatility, Amundi Index Solutions is 1.49 times less risky than Gold Bullion. It trades about 0.0 of its potential returns per unit of risk. Gold Bullion Securities is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 23,129 in Gold Bullion Securities on September 4, 2024 and sell it today you would earn a total of 27.00 from holding Gold Bullion Securities or generate 0.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amundi Index Solutions vs. Gold Bullion Securities
Performance |
| Timeline |
| Amundi Index Solutions |
| Gold Bullion Securities |
Amundi Index and Gold Bullion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi Index and Gold Bullion
The main advantage of trading using opposite Amundi Index and Gold Bullion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi Index position performs unexpectedly, Gold Bullion 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 Bullion will offset losses from the drop in Gold Bullion's long position.| Amundi Index vs. Manitou BF SA | Amundi Index vs. 21Shares Polkadot ETP | Amundi Index vs. Ekinops SA | Amundi Index vs. Orapi SA |
| Gold Bullion vs. Amundi Index Solutions | Gold Bullion vs. Multi Units Luxembourg | Gold Bullion vs. iShares Digital Entertainment | Gold Bullion vs. Amundi Index Solutions |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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