Correlation Between Antioquia Gold and Puma Exploration
Can any of the company-specific risk be diversified away by investing in both Antioquia Gold and Puma Exploration 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 Antioquia Gold and Puma Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Antioquia Gold and Puma Exploration, you can compare the effects of market volatilities on Antioquia Gold and Puma Exploration 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 Antioquia Gold with a short position of Puma Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Antioquia Gold and Puma Exploration.
Diversification Opportunities for Antioquia Gold and Puma Exploration
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Antioquia and Puma is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Antioquia Gold and Puma Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puma Exploration and Antioquia Gold 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 Antioquia Gold are associated (or correlated) with Puma Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puma Exploration has no effect on the direction of Antioquia Gold i.e., Antioquia Gold and Puma Exploration go up and down completely randomly.
Pair Corralation between Antioquia Gold and Puma Exploration
Assuming the 90 days horizon Antioquia Gold is expected to generate 16.74 times more return on investment than Puma Exploration. However, Antioquia Gold is 16.74 times more volatile than Puma Exploration. It trades about 0.12 of its potential returns per unit of risk. Puma Exploration is currently generating about 0.01 per unit of risk. If you would invest 0.50 in Antioquia Gold on August 29, 2024 and sell it today you would earn a total of 1.50 from holding Antioquia Gold or generate 300.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Antioquia Gold vs. Puma Exploration
Performance |
| Timeline |
| Antioquia Gold |
| Puma Exploration |
Antioquia Gold and Puma Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Antioquia Gold and Puma Exploration
The main advantage of trading using opposite Antioquia Gold and Puma Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Antioquia Gold position performs unexpectedly, Puma Exploration 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 Puma Exploration will offset losses from the drop in Puma Exploration's long position.| Antioquia Gold vs. Argo Gold | Antioquia Gold vs. Blue Star Gold | Antioquia Gold vs. Angkor Resources Corp | Antioquia Gold vs. Advance Gold Corp |
| Puma Exploration vs. Sixty North Gold | Puma Exploration vs. Red Pine Exploration | Puma Exploration vs. Grande Portage Resources | Puma Exploration vs. Altamira Gold Corp |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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