Correlation Between E Media and Gold Fields
Can any of the company-specific risk be diversified away by investing in both E Media and Gold Fields 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 E Media and Gold Fields into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between E Media Holdings and Gold Fields, you can compare the effects of market volatilities on E Media and Gold Fields 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 E Media with a short position of Gold Fields. Check out your portfolio center. Please also check ongoing floating volatility patterns of E Media and Gold Fields.
Diversification Opportunities for E Media and Gold Fields
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between EMH and Gold is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding E Media Holdings and Gold Fields in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Fields and E Media 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 E Media Holdings are associated (or correlated) with Gold Fields. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Fields has no effect on the direction of E Media i.e., E Media and Gold Fields go up and down completely randomly.
Pair Corralation between E Media and Gold Fields
If you would invest 31,100 in E Media Holdings on November 3, 2024 and sell it today you would earn a total of 4,400 from holding E Media Holdings or generate 14.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
E Media Holdings vs. Gold Fields
Performance |
| Timeline |
| E Media Holdings |
| Gold Fields |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
E Media and Gold Fields Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with E Media and Gold Fields
The main advantage of trading using opposite E Media and Gold Fields positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if E Media position performs unexpectedly, Gold Fields 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 Gold Fields will offset losses from the drop in Gold Fields' long position.| E Media vs. Blue Label Telecoms | E Media vs. Frontier Transport Holdings | E Media vs. HomeChoice Investments | E Media vs. African Media Entertainment |
| Gold Fields vs. eMedia Holdings Limited | Gold Fields vs. Kumba Iron Ore | Gold Fields vs. British American Tobacco | Gold Fields vs. Master Drilling Group |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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