Correlation Between DAIRY FARM and Barrick Gold
Can any of the company-specific risk be diversified away by investing in both DAIRY FARM and Barrick 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 DAIRY FARM and Barrick Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DAIRY FARM INTL and Barrick Gold, you can compare the effects of market volatilities on DAIRY FARM and Barrick 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 DAIRY FARM with a short position of Barrick Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAIRY FARM and Barrick Gold.
Diversification Opportunities for DAIRY FARM and Barrick Gold
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DAIRY and Barrick is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding DAIRY FARM INTL and Barrick Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barrick Gold and DAIRY FARM 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 DAIRY FARM INTL are associated (or correlated) with Barrick Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barrick Gold has no effect on the direction of DAIRY FARM i.e., DAIRY FARM and Barrick Gold go up and down completely randomly.
Pair Corralation between DAIRY FARM and Barrick Gold
Assuming the 90 days trading horizon DAIRY FARM INTL is expected to generate 1.19 times more return on investment than Barrick Gold. However, DAIRY FARM is 1.19 times more volatile than Barrick Gold. It trades about 0.01 of its potential returns per unit of risk. Barrick Gold is currently generating about 0.0 per unit of risk. If you would invest 245.00 in DAIRY FARM INTL on August 31, 2024 and sell it today you would lose (9.00) from holding DAIRY FARM INTL or give up 3.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAIRY FARM INTL vs. Barrick Gold
Performance |
| Timeline |
| DAIRY FARM INTL |
| Barrick Gold |
DAIRY FARM and Barrick Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DAIRY FARM and Barrick Gold
The main advantage of trading using opposite DAIRY FARM and Barrick Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAIRY FARM position performs unexpectedly, Barrick 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 Barrick Gold will offset losses from the drop in Barrick Gold's long position.| DAIRY FARM vs. SIVERS SEMICONDUCTORS AB | DAIRY FARM vs. Darden Restaurants | DAIRY FARM vs. Reliance Steel Aluminum | DAIRY FARM vs. Q2M Managementberatung AG |
| Barrick Gold vs. Kaiser Aluminum | Barrick Gold vs. AGRICULTBK HADR25 YC | Barrick Gold vs. PARKEN Sport Entertainment | Barrick Gold vs. DAIRY FARM INTL |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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