Correlation Between Arizona Gold and Great West
Can any of the company-specific risk be diversified away by investing in both Arizona Gold and Great West 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 Arizona Gold and Great West into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arizona Gold Silver and Great West Lifeco, you can compare the effects of market volatilities on Arizona Gold and Great West 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 Arizona Gold with a short position of Great West. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arizona Gold and Great West.
Diversification Opportunities for Arizona Gold and Great West
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Arizona and Great is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Arizona Gold Silver and Great West Lifeco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great West Lifeco and Arizona 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 Arizona Gold Silver are associated (or correlated) with Great West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great West Lifeco has no effect on the direction of Arizona Gold i.e., Arizona Gold and Great West go up and down completely randomly.
Pair Corralation between Arizona Gold and Great West
Assuming the 90 days horizon Arizona Gold Silver is expected to generate 6.39 times more return on investment than Great West. However, Arizona Gold is 6.39 times more volatile than Great West Lifeco. It trades about 0.04 of its potential returns per unit of risk. Great West Lifeco is currently generating about 0.1 per unit of risk. If you would invest 34.00 in Arizona Gold Silver on August 29, 2024 and sell it today you would earn a total of 8.00 from holding Arizona Gold Silver or generate 23.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arizona Gold Silver vs. Great West Lifeco
Performance |
| Timeline |
| Arizona Gold Silver |
| Great West Lifeco |
Arizona Gold and Great West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arizona Gold and Great West
The main advantage of trading using opposite Arizona Gold and Great West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arizona Gold position performs unexpectedly, Great West 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 Great West will offset losses from the drop in Great West's long position.| Arizona Gold vs. First Majestic Silver | Arizona Gold vs. Ivanhoe Energy | Arizona Gold vs. Orezone Gold Corp | Arizona Gold vs. Faraday Copper Corp |
| Great West vs. Canlan Ice Sports | Great West vs. Pembina Pipeline Corp | Great West vs. Richelieu Hardware | Great West vs. Datable Technology Corp |
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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