Correlation Between Eldorado Gold and Oak Woods
Can any of the company-specific risk be diversified away by investing in both Eldorado Gold and Oak Woods 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 Oak Woods 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 Oak Woods Acquisition, you can compare the effects of market volatilities on Eldorado Gold and Oak Woods 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 Oak Woods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eldorado Gold and Oak Woods.
Diversification Opportunities for Eldorado Gold and Oak Woods
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eldorado and Oak is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Eldorado Gold Corp and Oak Woods Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oak Woods Acquisition 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 Oak Woods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oak Woods Acquisition has no effect on the direction of Eldorado Gold i.e., Eldorado Gold and Oak Woods go up and down completely randomly.
Pair Corralation between Eldorado Gold and Oak Woods
Considering the 90-day investment horizon Eldorado Gold Corp is expected to under-perform the Oak Woods. In addition to that, Eldorado Gold is 6.13 times more volatile than Oak Woods Acquisition. It trades about -0.03 of its total potential returns per unit of risk. Oak Woods Acquisition is currently generating about 0.03 per unit of volatility. If you would invest 1,144 in Oak Woods Acquisition on November 30, 2024 and sell it today you would earn a total of 7.00 from holding Oak Woods Acquisition or generate 0.61% 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. Oak Woods Acquisition
Performance |
| Timeline |
| Eldorado Gold Corp |
| Oak Woods Acquisition |
Eldorado Gold and Oak Woods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eldorado Gold and Oak Woods
The main advantage of trading using opposite Eldorado Gold and Oak Woods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eldorado Gold position performs unexpectedly, Oak Woods 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 Oak Woods will offset losses from the drop in Oak Woods' long position.| Eldorado Gold vs. IAMGold | Eldorado Gold vs. Kinross Gold | Eldorado Gold vs. Agnico Eagle Mines | Eldorado Gold vs. Gold Fields Ltd |
| Oak Woods vs. Qorvo Inc | Oak Woods vs. Zoom Video Communications | Oak Woods vs. Entegris | Oak Woods vs. Teradyne |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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