Correlation Between Eldorado Gold and U Power
Can any of the company-specific risk be diversified away by investing in both Eldorado Gold and U Power 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 U Power 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 U Power Limited, you can compare the effects of market volatilities on Eldorado Gold and U Power 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 U Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eldorado Gold and U Power.
Diversification Opportunities for Eldorado Gold and U Power
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eldorado and UCAR is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Eldorado Gold Corp and U Power Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Power Limited 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 U Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Power Limited has no effect on the direction of Eldorado Gold i.e., Eldorado Gold and U Power go up and down completely randomly.
Pair Corralation between Eldorado Gold and U Power
Considering the 90-day investment horizon Eldorado Gold Corp is expected to generate 0.61 times more return on investment than U Power. However, Eldorado Gold Corp is 1.64 times less risky than U Power. It trades about -0.18 of its potential returns per unit of risk. U Power Limited is currently generating about -0.22 per unit of risk. If you would invest 1,796 in Eldorado Gold Corp on August 31, 2024 and sell it today you would lose (208.00) from holding Eldorado Gold Corp or give up 11.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eldorado Gold Corp vs. U Power Limited
Performance |
| Timeline |
| Eldorado Gold Corp |
| U Power Limited |
Eldorado Gold and U Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eldorado Gold and U Power
The main advantage of trading using opposite Eldorado Gold and U Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eldorado Gold position performs unexpectedly, U Power 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 U Power will offset losses from the drop in U Power's long position.| Eldorado Gold vs. Franco Nevada | Eldorado Gold vs. Alamos Gold | Eldorado Gold vs. Seabridge Gold | Eldorado Gold vs. Osisko Gold Ro |
| U Power vs. Kaixin Auto Holdings | U Power vs. Uxin | U Power vs. SunCar Technology Group | U Power vs. Carvana Co |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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