Correlation Between GOLD ROAD and CHINA TONTINE
Can any of the company-specific risk be diversified away by investing in both GOLD ROAD and CHINA TONTINE 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 GOLD ROAD and CHINA TONTINE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GOLD ROAD RES and CHINA TONTINE WINES, you can compare the effects of market volatilities on GOLD ROAD and CHINA TONTINE 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 GOLD ROAD with a short position of CHINA TONTINE. Check out your portfolio center. Please also check ongoing floating volatility patterns of GOLD ROAD and CHINA TONTINE.
Diversification Opportunities for GOLD ROAD and CHINA TONTINE
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GOLD and CHINA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GOLD ROAD RES and CHINA TONTINE WINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA TONTINE WINES and GOLD ROAD 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 GOLD ROAD RES are associated (or correlated) with CHINA TONTINE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA TONTINE WINES has no effect on the direction of GOLD ROAD i.e., GOLD ROAD and CHINA TONTINE go up and down completely randomly.
Pair Corralation between GOLD ROAD and CHINA TONTINE
If you would invest 113.00 in GOLD ROAD RES on September 26, 2024 and sell it today you would earn a total of 9.00 from holding GOLD ROAD RES or generate 7.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GOLD ROAD RES vs. CHINA TONTINE WINES
Performance |
| Timeline |
| GOLD ROAD RES |
| CHINA TONTINE WINES |
GOLD ROAD and CHINA TONTINE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GOLD ROAD and CHINA TONTINE
The main advantage of trading using opposite GOLD ROAD and CHINA TONTINE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GOLD ROAD position performs unexpectedly, CHINA TONTINE 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 CHINA TONTINE will offset losses from the drop in CHINA TONTINE's long position.The idea behind GOLD ROAD RES and CHINA TONTINE WINES pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| CHINA TONTINE vs. INSURANCE AUST GRP | CHINA TONTINE vs. Apollo Investment Corp | CHINA TONTINE vs. JLF INVESTMENT | CHINA TONTINE vs. Virtus Investment Partners |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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