Correlation Between City National and Precious Metals
Can any of the company-specific risk be diversified away by investing in both City National and Precious Metals 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 City National and Precious Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between City National Rochdale and Precious Metals And, you can compare the effects of market volatilities on City National and Precious Metals 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 City National with a short position of Precious Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of City National and Precious Metals.
Diversification Opportunities for City National and Precious Metals
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between City and Precious is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding City National Rochdale and Precious Metals And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Precious Metals And and City National 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 City National Rochdale are associated (or correlated) with Precious Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Precious Metals And has no effect on the direction of City National i.e., City National and Precious Metals go up and down completely randomly.
Pair Corralation between City National and Precious Metals
Assuming the 90 days horizon City National Rochdale is expected to generate 0.48 times more return on investment than Precious Metals. However, City National Rochdale is 2.06 times less risky than Precious Metals. It trades about 0.12 of its potential returns per unit of risk. Precious Metals And is currently generating about 0.05 per unit of risk. If you would invest 2,552 in City National Rochdale on September 3, 2024 and sell it today you would earn a total of 376.00 from holding City National Rochdale or generate 14.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
City National Rochdale vs. Precious Metals And
Performance |
| Timeline |
| City National Rochdale |
| Precious Metals And |
City National and Precious Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with City National and Precious Metals
The main advantage of trading using opposite City National and Precious Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if City National position performs unexpectedly, Precious Metals 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 Precious Metals will offset losses from the drop in Precious Metals' long position.| City National vs. Precious Metals And | City National vs. James Balanced Golden | City National vs. Gold And Precious | City National vs. Goldman Sachs Short |
| Precious Metals vs. Oppenheimer Gold Special | Precious Metals vs. Global Gold Fund | Precious Metals vs. Goldman Sachs Clean | Precious Metals vs. Fidelity Advisor Gold |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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