Correlation Between Alamos Gold and Equinox Gold
Can any of the company-specific risk be diversified away by investing in both Alamos Gold and Equinox Gold 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 Equinox Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alamos Gold and Equinox Gold Corp, you can compare the effects of market volatilities on Alamos Gold and Equinox Gold 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 Equinox Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alamos Gold and Equinox Gold.
Diversification Opportunities for Alamos Gold and Equinox Gold
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Alamos and Equinox is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Alamos Gold and Equinox Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equinox Gold Corp 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 Equinox Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equinox Gold Corp has no effect on the direction of Alamos Gold i.e., Alamos Gold and Equinox Gold go up and down completely randomly.
Pair Corralation between Alamos Gold and Equinox Gold
Considering the 90-day investment horizon Alamos Gold is expected to generate 0.63 times more return on investment than Equinox Gold. However, Alamos Gold is 1.58 times less risky than Equinox Gold. It trades about 0.09 of its potential returns per unit of risk. Equinox Gold Corp is currently generating about 0.06 per unit of risk. If you would invest 1,004 in Alamos Gold on November 9, 2024 and sell it today you would earn a total of 1,221 from holding Alamos Gold or generate 121.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alamos Gold vs. Equinox Gold Corp
Performance |
| Timeline |
| Alamos Gold |
| Equinox Gold Corp |
Alamos Gold and Equinox Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alamos Gold and Equinox Gold
The main advantage of trading using opposite Alamos Gold and Equinox Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alamos Gold position performs unexpectedly, Equinox Gold 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 Equinox Gold will offset losses from the drop in Equinox Gold's long position.| Alamos Gold vs. Pan American Silver | Alamos Gold vs. Newmont Goldcorp Corp | Alamos Gold vs. Wheaton Precious Metals | Alamos Gold vs. Franco Nevada |
| Equinox Gold vs. Coeur Mining | Equinox Gold vs. B2Gold Corp | Equinox Gold vs. Sandstorm Gold Ltd | Equinox Gold vs. Pan American Silver |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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