Correlation Between Alamos Gold and Gfl Environmental
Can any of the company-specific risk be diversified away by investing in both Alamos Gold and Gfl Environmental 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 Alamos Gold and Gfl Environmental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alamos Gold and Gfl Environmental Holdings, you can compare the effects of market volatilities on Alamos Gold and Gfl Environmental 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 Alamos Gold with a short position of Gfl Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alamos Gold and Gfl Environmental.
Diversification Opportunities for Alamos Gold and Gfl Environmental
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alamos and Gfl is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Alamos Gold and Gfl Environmental Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gfl Environmental and Alamos 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 Alamos Gold are associated (or correlated) with Gfl Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gfl Environmental has no effect on the direction of Alamos Gold i.e., Alamos Gold and Gfl Environmental go up and down completely randomly.
Pair Corralation between Alamos Gold and Gfl Environmental
Assuming the 90 days trading horizon Alamos Gold is expected to generate 1.16 times more return on investment than Gfl Environmental. However, Alamos Gold is 1.16 times more volatile than Gfl Environmental Holdings. It trades about 0.09 of its potential returns per unit of risk. Gfl Environmental Holdings is currently generating about 0.06 per unit of risk. If you would invest 1,572 in Alamos Gold on December 12, 2024 and sell it today you would earn a total of 1,883 from holding Alamos Gold or generate 119.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alamos Gold vs. Gfl Environmental Holdings
Performance |
| Timeline |
| Alamos Gold |
| Gfl Environmental |
Alamos Gold and Gfl Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alamos Gold and Gfl Environmental
The main advantage of trading using opposite Alamos Gold and Gfl Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alamos Gold position performs unexpectedly, Gfl Environmental 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 Gfl Environmental will offset losses from the drop in Gfl Environmental's long position.| Alamos Gold vs. E L Financial Corp | ||
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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