Correlation Between Aya Gold and Highway 50
Can any of the company-specific risk be diversified away by investing in both Aya Gold and Highway 50 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 Aya Gold and Highway 50 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aya Gold Silver and Highway 50 Gold, you can compare the effects of market volatilities on Aya Gold and Highway 50 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 Aya Gold with a short position of Highway 50. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aya Gold and Highway 50.
Diversification Opportunities for Aya Gold and Highway 50
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aya and Highway is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Aya Gold Silver and Highway 50 Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Highway 50 Gold and Aya 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 Aya Gold Silver are associated (or correlated) with Highway 50. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Highway 50 Gold has no effect on the direction of Aya Gold i.e., Aya Gold and Highway 50 go up and down completely randomly.
Pair Corralation between Aya Gold and Highway 50
Assuming the 90 days trading horizon Aya Gold is expected to generate 11.26 times less return on investment than Highway 50. But when comparing it to its historical volatility, Aya Gold Silver is 2.23 times less risky than Highway 50. It trades about 0.01 of its potential returns per unit of risk. Highway 50 Gold is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 15.00 in Highway 50 Gold on October 12, 2024 and sell it today you would lose (1.00) from holding Highway 50 Gold or give up 6.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aya Gold Silver vs. Highway 50 Gold
Performance |
| Timeline |
| Aya Gold Silver |
| Highway 50 Gold |
Aya Gold and Highway 50 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aya Gold and Highway 50
The main advantage of trading using opposite Aya Gold and Highway 50 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aya Gold position performs unexpectedly, Highway 50 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 Highway 50 will offset losses from the drop in Highway 50's long position.| Aya Gold vs. GoGold Resources | Aya Gold vs. AbraSilver Resource Corp | Aya Gold vs. SilverCrest Metals | Aya Gold vs. Santacruz Silv |
| Highway 50 vs. Postmedia Network Canada | Highway 50 vs. Summa Silver Corp | Highway 50 vs. Aya Gold Silver | Highway 50 vs. Renoworks Software |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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