Correlation Between Dacian Gold and Caledonia Mining
Can any of the company-specific risk be diversified away by investing in both Dacian Gold and Caledonia Mining 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 Dacian Gold and Caledonia Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dacian Gold Limited and Caledonia Mining, you can compare the effects of market volatilities on Dacian Gold and Caledonia Mining 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 Dacian Gold with a short position of Caledonia Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dacian Gold and Caledonia Mining.
Diversification Opportunities for Dacian Gold and Caledonia Mining
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dacian and Caledonia is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Dacian Gold Limited and Caledonia Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caledonia Mining and Dacian 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 Dacian Gold Limited are associated (or correlated) with Caledonia Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caledonia Mining has no effect on the direction of Dacian Gold i.e., Dacian Gold and Caledonia Mining go up and down completely randomly.
Pair Corralation between Dacian Gold and Caledonia Mining
If you would invest 1,068 in Caledonia Mining on August 26, 2024 and sell it today you would earn a total of 5.00 from holding Caledonia Mining or generate 0.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 0.3% |
| Values | Daily Returns |
Dacian Gold Limited vs. Caledonia Mining
Performance |
| Timeline |
| Dacian Gold Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Caledonia Mining |
Dacian Gold and Caledonia Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dacian Gold and Caledonia Mining
The main advantage of trading using opposite Dacian Gold and Caledonia Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dacian Gold position performs unexpectedly, Caledonia Mining 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 Caledonia Mining will offset losses from the drop in Caledonia Mining's long position.| Dacian Gold vs. Minnova Corp | Dacian Gold vs. Argo Gold | Dacian Gold vs. Advance Gold Corp | Dacian Gold vs. Blue Star Gold |
| Caledonia Mining vs. DRDGOLD Limited ADR | Caledonia Mining vs. Galiano Gold | Caledonia Mining vs. Mastech Holdings | Caledonia Mining vs. EMX Royalty 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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