Correlation Between Centerra Gold and Regis Resources
Can any of the company-specific risk be diversified away by investing in both Centerra Gold and Regis Resources 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 Centerra Gold and Regis Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centerra Gold and Regis Resources, you can compare the effects of market volatilities on Centerra Gold and Regis Resources 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 Centerra Gold with a short position of Regis Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centerra Gold and Regis Resources.
Diversification Opportunities for Centerra Gold and Regis Resources
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Centerra and Regis is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Centerra Gold and Regis Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regis Resources and Centerra 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 Centerra Gold are associated (or correlated) with Regis Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regis Resources has no effect on the direction of Centerra Gold i.e., Centerra Gold and Regis Resources go up and down completely randomly.
Pair Corralation between Centerra Gold and Regis Resources
Given the investment horizon of 90 days Centerra Gold is expected to under-perform the Regis Resources. In addition to that, Centerra Gold is 1.1 times more volatile than Regis Resources. It trades about -0.29 of its total potential returns per unit of risk. Regis Resources is currently generating about -0.1 per unit of volatility. If you would invest 181.00 in Regis Resources on August 30, 2024 and sell it today you would lose (11.00) from holding Regis Resources or give up 6.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centerra Gold vs. Regis Resources
Performance |
| Timeline |
| Centerra Gold |
| Regis Resources |
Centerra Gold and Regis Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centerra Gold and Regis Resources
The main advantage of trading using opposite Centerra Gold and Regis Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centerra Gold position performs unexpectedly, Regis Resources 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 Regis Resources will offset losses from the drop in Regis Resources' long position.| Centerra Gold vs. Gold Fields Ltd | Centerra Gold vs. Eldorado Gold Corp | Centerra Gold vs. Osisko Gold Ro | Centerra Gold vs. SSR Mining |
| Regis Resources vs. Vertiv Holdings Co | Regis Resources vs. Nasdaq Inc | Regis Resources vs. McDonalds | Regis Resources vs. Walmart |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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