Correlation Between Amaroq Minerals and Golden Metal
Can any of the company-specific risk be diversified away by investing in both Amaroq Minerals and Golden Metal 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 Amaroq Minerals and Golden Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amaroq Minerals and Golden Metal Resources, you can compare the effects of market volatilities on Amaroq Minerals and Golden Metal 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 Amaroq Minerals with a short position of Golden Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amaroq Minerals and Golden Metal.
Diversification Opportunities for Amaroq Minerals and Golden Metal
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amaroq and Golden is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Amaroq Minerals and Golden Metal Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Metal Resources and Amaroq 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 Amaroq Minerals are associated (or correlated) with Golden Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Metal Resources has no effect on the direction of Amaroq Minerals i.e., Amaroq Minerals and Golden Metal go up and down completely randomly.
Pair Corralation between Amaroq Minerals and Golden Metal
Assuming the 90 days trading horizon Amaroq Minerals is expected to generate 9.79 times less return on investment than Golden Metal. In addition to that, Amaroq Minerals is 1.28 times more volatile than Golden Metal Resources. It trades about 0.03 of its total potential returns per unit of risk. Golden Metal Resources is currently generating about 0.32 per unit of volatility. If you would invest 2,800 in Golden Metal Resources on October 23, 2024 and sell it today you would earn a total of 400.00 from holding Golden Metal Resources or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amaroq Minerals vs. Golden Metal Resources
Performance |
| Timeline |
| Amaroq Minerals |
| Golden Metal Resources |
Amaroq Minerals and Golden Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amaroq Minerals and Golden Metal
The main advantage of trading using opposite Amaroq Minerals and Golden Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amaroq Minerals position performs unexpectedly, Golden Metal 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 Golden Metal will offset losses from the drop in Golden Metal's long position.| Amaroq Minerals vs. Givaudan SA | Amaroq Minerals vs. Antofagasta PLC | Amaroq Minerals vs. Ferrexpo PLC | Amaroq Minerals vs. Atalaya Mining |
| Golden Metal vs. BlackRock Frontiers Investment | Golden Metal vs. Bankers Investment Trust | Golden Metal vs. Software Circle plc | Golden Metal vs. Smithson Investment Trust |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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