Correlation Between Eldorado Gold and Evolution Mining
Can any of the company-specific risk be diversified away by investing in both Eldorado Gold and Evolution 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 Eldorado Gold and Evolution Mining 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 Evolution Mining, you can compare the effects of market volatilities on Eldorado Gold and Evolution 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 Eldorado Gold with a short position of Evolution Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eldorado Gold and Evolution Mining.
Diversification Opportunities for Eldorado Gold and Evolution Mining
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Eldorado and Evolution is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Eldorado Gold Corp and Evolution Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolution Mining 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 Evolution Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolution Mining has no effect on the direction of Eldorado Gold i.e., Eldorado Gold and Evolution Mining go up and down completely randomly.
Pair Corralation between Eldorado Gold and Evolution Mining
Considering the 90-day investment horizon Eldorado Gold Corp is expected to under-perform the Evolution Mining. But the stock apears to be less risky and, when comparing its historical volatility, Eldorado Gold Corp is 1.17 times less risky than Evolution Mining. The stock trades about -0.18 of its potential returns per unit of risk. The Evolution Mining is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 320.00 in Evolution Mining on August 31, 2024 and sell it today you would lose (4.00) from holding Evolution Mining or give up 1.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eldorado Gold Corp vs. Evolution Mining
Performance |
| Timeline |
| Eldorado Gold Corp |
| Evolution Mining |
Eldorado Gold and Evolution Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eldorado Gold and Evolution Mining
The main advantage of trading using opposite Eldorado Gold and Evolution Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eldorado Gold position performs unexpectedly, Evolution 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 Evolution Mining will offset losses from the drop in Evolution Mining's long position.| Eldorado Gold vs. Franco Nevada | Eldorado Gold vs. Alamos Gold | Eldorado Gold vs. Seabridge Gold | Eldorado Gold vs. Osisko Gold Ro |
| Evolution Mining vs. Regis Resources | Evolution Mining vs. West African Resources | Evolution Mining vs. Allegiant Gold | Evolution Mining vs. Minaurum Gold |
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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