Correlation Between Barings BDC and Eldorado Gold
Can any of the company-specific risk be diversified away by investing in both Barings BDC and Eldorado 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 Barings BDC and Eldorado Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings BDC and Eldorado Gold Corp, you can compare the effects of market volatilities on Barings BDC and Eldorado 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 Barings BDC with a short position of Eldorado Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings BDC and Eldorado Gold.
Diversification Opportunities for Barings BDC and Eldorado Gold
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Barings and Eldorado is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Barings BDC and Eldorado Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eldorado Gold Corp and Barings BDC 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 Barings BDC are associated (or correlated) with Eldorado Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eldorado Gold Corp has no effect on the direction of Barings BDC i.e., Barings BDC and Eldorado Gold go up and down completely randomly.
Pair Corralation between Barings BDC and Eldorado Gold
Given the investment horizon of 90 days Barings BDC is expected to generate 1.4 times less return on investment than Eldorado Gold. But when comparing it to its historical volatility, Barings BDC is 2.2 times less risky than Eldorado Gold. It trades about 0.09 of its potential returns per unit of risk. Eldorado Gold Corp is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,229 in Eldorado Gold Corp on September 4, 2024 and sell it today you would earn a total of 394.00 from holding Eldorado Gold Corp or generate 32.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings BDC vs. Eldorado Gold Corp
Performance |
| Timeline |
| Barings BDC |
| Eldorado Gold Corp |
Barings BDC and Eldorado Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings BDC and Eldorado Gold
The main advantage of trading using opposite Barings BDC and Eldorado Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings BDC position performs unexpectedly, Eldorado 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 Eldorado Gold will offset losses from the drop in Eldorado Gold's long position.| Barings BDC vs. Runway Growth Finance | Barings BDC vs. OneMain Holdings | Barings BDC vs. Navient Corp | Barings BDC vs. Oaktree Specialty Lending |
| Eldorado Gold vs. Constellium Nv | Eldorado Gold vs. Century Aluminum | Eldorado Gold vs. China Hongqiao Group | Eldorado Gold vs. Kaiser Aluminum |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |