Correlation Between European Metals and Amundi Physical
Can any of the company-specific risk be diversified away by investing in both European Metals and Amundi Physical 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 European Metals and Amundi Physical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between European Metals Holdings and Amundi Physical Gold, you can compare the effects of market volatilities on European Metals and Amundi Physical 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 European Metals with a short position of Amundi Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of European Metals and Amundi Physical.
Diversification Opportunities for European Metals and Amundi Physical
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between European and Amundi is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding European Metals Holdings and Amundi Physical Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi Physical Gold and European Metals 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 European Metals Holdings are associated (or correlated) with Amundi Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi Physical Gold has no effect on the direction of European Metals i.e., European Metals and Amundi Physical go up and down completely randomly.
Pair Corralation between European Metals and Amundi Physical
Assuming the 90 days trading horizon European Metals Holdings is expected to under-perform the Amundi Physical. In addition to that, European Metals is 4.06 times more volatile than Amundi Physical Gold. It trades about -0.2 of its total potential returns per unit of risk. Amundi Physical Gold is currently generating about 0.12 per unit of volatility. If you would invest 731,663 in Amundi Physical Gold on September 3, 2024 and sell it today you would earn a total of 99,862 from holding Amundi Physical Gold or generate 13.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
European Metals Holdings vs. Amundi Physical Gold
Performance |
| Timeline |
| European Metals Holdings |
| Amundi Physical Gold |
European Metals and Amundi Physical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with European Metals and Amundi Physical
The main advantage of trading using opposite European Metals and Amundi Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if European Metals position performs unexpectedly, Amundi Physical 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 Amundi Physical will offset losses from the drop in Amundi Physical's long position.| European Metals vs. Virgin Wines UK | European Metals vs. UNIQA Insurance Group | European Metals vs. CompuGroup Medical AG | European Metals vs. Fresenius Medical Care |
| Amundi Physical vs. Sabien Technology Group | Amundi Physical vs. Smithson Investment Trust | Amundi Physical vs. Spotify Technology SA | Amundi Physical vs. K3 Business Technology |
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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