Correlation Between Argo Gold and Allegiant Gold
Can any of the company-specific risk be diversified away by investing in both Argo Gold and Allegiant 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 Argo Gold and Allegiant Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Argo Gold and Allegiant Gold, you can compare the effects of market volatilities on Argo Gold and Allegiant 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 Argo Gold with a short position of Allegiant Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Argo Gold and Allegiant Gold.
Diversification Opportunities for Argo Gold and Allegiant Gold
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Argo and Allegiant is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Argo Gold and Allegiant Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allegiant Gold and Argo 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 Argo Gold are associated (or correlated) with Allegiant Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allegiant Gold has no effect on the direction of Argo Gold i.e., Argo Gold and Allegiant Gold go up and down completely randomly.
Pair Corralation between Argo Gold and Allegiant Gold
Assuming the 90 days horizon Argo Gold is expected to generate 0.62 times more return on investment than Allegiant Gold. However, Argo Gold is 1.62 times less risky than Allegiant Gold. It trades about -0.24 of its potential returns per unit of risk. Allegiant Gold is currently generating about -0.19 per unit of risk. If you would invest 5.60 in Argo Gold on August 26, 2024 and sell it today you would lose (1.10) from holding Argo Gold or give up 19.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Argo Gold vs. Allegiant Gold
Performance |
| Timeline |
| Argo Gold |
| Allegiant Gold |
Argo Gold and Allegiant Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Argo Gold and Allegiant Gold
The main advantage of trading using opposite Argo Gold and Allegiant Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Argo Gold position performs unexpectedly, Allegiant 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 Allegiant Gold will offset losses from the drop in Allegiant Gold's long position.| Argo Gold vs. Aurion Resources | Argo Gold vs. Liberty Gold Corp | Argo Gold vs. Rio2 Limited | Argo Gold vs. Orezone Gold Corp |
| Allegiant Gold vs. Minnova Corp | Allegiant Gold vs. Argo Gold | Allegiant Gold vs. Advance Gold Corp | Allegiant Gold vs. Blue Star Gold |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |