Correlation Between Eldorado Gold and Oatly Group
Can any of the company-specific risk be diversified away by investing in both Eldorado Gold and Oatly 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 Oatly 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 Oatly Group AB, you can compare the effects of market volatilities on Eldorado Gold and Oatly 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 Oatly Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eldorado Gold and Oatly Group.
Diversification Opportunities for Eldorado Gold and Oatly Group
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eldorado and Oatly is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Eldorado Gold Corp and Oatly Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oatly Group AB 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 Oatly Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oatly Group AB has no effect on the direction of Eldorado Gold i.e., Eldorado Gold and Oatly Group go up and down completely randomly.
Pair Corralation between Eldorado Gold and Oatly Group
Considering the 90-day investment horizon Eldorado Gold Corp is expected to under-perform the Oatly Group. But the stock apears to be less risky and, when comparing its historical volatility, Eldorado Gold Corp is 1.97 times less risky than Oatly Group. The stock trades about -0.12 of its potential returns per unit of risk. The Oatly Group AB is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 81.00 in Oatly Group AB on August 27, 2024 and sell it today you would lose (7.00) from holding Oatly Group AB or give up 8.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eldorado Gold Corp vs. Oatly Group AB
Performance |
| Timeline |
| Eldorado Gold Corp |
| Oatly Group AB |
Eldorado Gold and Oatly Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eldorado Gold and Oatly Group
The main advantage of trading using opposite Eldorado Gold and Oatly Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eldorado Gold position performs unexpectedly, Oatly 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 Oatly Group will offset losses from the drop in Oatly 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 |
| Oatly Group vs. Bellring Brands LLC | Oatly Group vs. Ingredion Incorporated | Oatly Group vs. Nomad Foods | Oatly Group vs. Simply Good Foods |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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