Correlation Between Eldorado Gold and Joint Stock
Can any of the company-specific risk be diversified away by investing in both Eldorado Gold and Joint Stock 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 Joint Stock 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 Joint Stock, you can compare the effects of market volatilities on Eldorado Gold and Joint Stock 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 Joint Stock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eldorado Gold and Joint Stock.
Diversification Opportunities for Eldorado Gold and Joint Stock
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Eldorado and Joint is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Eldorado Gold Corp and Joint Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Joint Stock 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 Joint Stock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Joint Stock has no effect on the direction of Eldorado Gold i.e., Eldorado Gold and Joint Stock go up and down completely randomly.
Pair Corralation between Eldorado Gold and Joint Stock
Considering the 90-day investment horizon Eldorado Gold Corp is expected to under-perform the Joint Stock. In addition to that, Eldorado Gold is 1.44 times more volatile than Joint Stock. It trades about -0.06 of its total potential returns per unit of risk. Joint Stock is currently generating about -0.05 per unit of volatility. If you would invest 10,835 in Joint Stock on September 4, 2024 and sell it today you would lose (218.00) from holding Joint Stock or give up 2.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eldorado Gold Corp vs. Joint Stock
Performance |
| Timeline |
| Eldorado Gold Corp |
| Joint Stock |
Eldorado Gold and Joint Stock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eldorado Gold and Joint Stock
The main advantage of trading using opposite Eldorado Gold and Joint Stock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eldorado Gold position performs unexpectedly, Joint Stock 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 Joint Stock will offset losses from the drop in Joint Stock's long position.| Eldorado Gold vs. Constellium Nv | Eldorado Gold vs. Century Aluminum | Eldorado Gold vs. China Hongqiao Group | Eldorado Gold vs. Kaiser Aluminum |
| Joint Stock vs. Mativ Holdings | Joint Stock vs. Avient Corp | Joint Stock vs. Eastman Chemical | Joint Stock vs. Ecoloclean Industrs |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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