Correlation Between DRDGOLD Limited and Maple Gold
Can any of the company-specific risk be diversified away by investing in both DRDGOLD Limited and Maple 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 DRDGOLD Limited and Maple Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DRDGOLD Limited ADR and Maple Gold Mines, you can compare the effects of market volatilities on DRDGOLD Limited and Maple 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 DRDGOLD Limited with a short position of Maple Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of DRDGOLD Limited and Maple Gold.
Diversification Opportunities for DRDGOLD Limited and Maple Gold
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between DRDGOLD and Maple is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding DRDGOLD Limited ADR and Maple Gold Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maple Gold Mines and DRDGOLD Limited 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 DRDGOLD Limited ADR are associated (or correlated) with Maple Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maple Gold Mines has no effect on the direction of DRDGOLD Limited i.e., DRDGOLD Limited and Maple Gold go up and down completely randomly.
Pair Corralation between DRDGOLD Limited and Maple Gold
Considering the 90-day investment horizon DRDGOLD Limited ADR is expected to generate 0.48 times more return on investment than Maple Gold. However, DRDGOLD Limited ADR is 2.1 times less risky than Maple Gold. It trades about 0.04 of its potential returns per unit of risk. Maple Gold Mines is currently generating about 0.0 per unit of risk. If you would invest 684.00 in DRDGOLD Limited ADR on November 2, 2024 and sell it today you would earn a total of 351.00 from holding DRDGOLD Limited ADR or generate 51.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
DRDGOLD Limited ADR vs. Maple Gold Mines
Performance |
| Timeline |
| DRDGOLD Limited ADR |
| Maple Gold Mines |
DRDGOLD Limited and Maple Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DRDGOLD Limited and Maple Gold
The main advantage of trading using opposite DRDGOLD Limited and Maple Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DRDGOLD Limited position performs unexpectedly, Maple 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 Maple Gold will offset losses from the drop in Maple Gold's long position.| DRDGOLD Limited vs. Osisko Gold Ro | DRDGOLD Limited vs. Eldorado Gold Corp | DRDGOLD Limited vs. SSR Mining | DRDGOLD Limited vs. Idaho Strategic Resources |
| Maple Gold vs. Steppe Gold | Maple Gold vs. Caledonia Mining | Maple Gold vs. Fortuna Silver Mines | Maple Gold vs. Sandstorm Gold Ltd |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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