Correlation Between Amani Gold and Loncor Gold
Can any of the company-specific risk be diversified away by investing in both Amani Gold and Loncor 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 Amani Gold and Loncor Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amani Gold Limited and Loncor Gold, you can compare the effects of market volatilities on Amani Gold and Loncor 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 Amani Gold with a short position of Loncor Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amani Gold and Loncor Gold.
Diversification Opportunities for Amani Gold and Loncor Gold
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Amani and Loncor is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Amani Gold Limited and Loncor Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loncor Gold and Amani 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 Amani Gold Limited are associated (or correlated) with Loncor Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loncor Gold has no effect on the direction of Amani Gold i.e., Amani Gold and Loncor Gold go up and down completely randomly.
Pair Corralation between Amani Gold and Loncor Gold
If you would invest 26.00 in Loncor Gold on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Loncor Gold or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amani Gold Limited vs. Loncor Gold
Performance |
| Timeline |
| Amani Gold Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Loncor Gold |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Amani Gold and Loncor Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amani Gold and Loncor Gold
The main advantage of trading using opposite Amani Gold and Loncor Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amani Gold position performs unexpectedly, Loncor 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 Loncor Gold will offset losses from the drop in Loncor Gold's long position.| Amani Gold vs. Antioquia Gold | Amani Gold vs. Asante Gold | Amani Gold vs. Bluestone Resources | Amani Gold vs. Big Ridge Gold |
| Loncor Gold vs. Galiano Gold | Loncor Gold vs. Brunswick Exploration | Loncor Gold vs. B2Gold Corp | Loncor Gold vs. Japan Gold 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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