Correlation Between Eldorado Gold and ANZ Group
Can any of the company-specific risk be diversified away by investing in both Eldorado Gold and ANZ Group 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 Eldorado Gold and ANZ Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eldorado Gold Corp and ANZ Group Holdings, you can compare the effects of market volatilities on Eldorado Gold and ANZ Group 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 Eldorado Gold with a short position of ANZ Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eldorado Gold and ANZ Group.
Diversification Opportunities for Eldorado Gold and ANZ Group
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Eldorado and ANZ is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Eldorado Gold Corp and ANZ Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANZ Group Holdings and Eldorado 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 Eldorado Gold Corp are associated (or correlated) with ANZ Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANZ Group Holdings has no effect on the direction of Eldorado Gold i.e., Eldorado Gold and ANZ Group go up and down completely randomly.
Pair Corralation between Eldorado Gold and ANZ Group
Considering the 90-day investment horizon Eldorado Gold Corp is expected to generate 2.07 times more return on investment than ANZ Group. However, Eldorado Gold is 2.07 times more volatile than ANZ Group Holdings. It trades about 0.05 of its potential returns per unit of risk. ANZ Group Holdings is currently generating about 0.11 per unit of risk. If you would invest 1,249 in Eldorado Gold Corp on September 3, 2024 and sell it today you would earn a total of 330.00 from holding Eldorado Gold Corp or generate 26.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eldorado Gold Corp vs. ANZ Group Holdings
Performance |
| Timeline |
| Eldorado Gold Corp |
| ANZ Group Holdings |
Eldorado Gold and ANZ Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eldorado Gold and ANZ Group
The main advantage of trading using opposite Eldorado Gold and ANZ Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eldorado Gold position performs unexpectedly, ANZ Group 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 ANZ Group will offset losses from the drop in ANZ Group's long position.| Eldorado Gold vs. IAMGold | Eldorado Gold vs. Kinross Gold | Eldorado Gold vs. Agnico Eagle Mines | Eldorado Gold vs. Gold Fields Ltd |
| ANZ Group vs. JPMorgan Chase Co | ANZ Group vs. JPMorgan Chase Co | ANZ Group vs. Bank of America | ANZ Group vs. Brera Holdings PLC |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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