Correlation Between Altamira Gold and DRDGOLD Limited
Can any of the company-specific risk be diversified away by investing in both Altamira Gold and DRDGOLD Limited 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 Altamira Gold and DRDGOLD Limited into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altamira Gold Corp and DRDGOLD Limited ADR, you can compare the effects of market volatilities on Altamira Gold and DRDGOLD Limited 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 Altamira Gold with a short position of DRDGOLD Limited. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altamira Gold and DRDGOLD Limited.
Diversification Opportunities for Altamira Gold and DRDGOLD Limited
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Altamira and DRDGOLD is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Altamira Gold Corp and DRDGOLD Limited ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DRDGOLD Limited ADR and Altamira 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 Altamira Gold Corp are associated (or correlated) with DRDGOLD Limited. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DRDGOLD Limited ADR has no effect on the direction of Altamira Gold i.e., Altamira Gold and DRDGOLD Limited go up and down completely randomly.
Pair Corralation between Altamira Gold and DRDGOLD Limited
Assuming the 90 days horizon Altamira Gold Corp is expected to under-perform the DRDGOLD Limited. In addition to that, Altamira Gold is 1.44 times more volatile than DRDGOLD Limited ADR. It trades about 0.0 of its total potential returns per unit of risk. DRDGOLD Limited ADR is currently generating about 0.18 per unit of volatility. If you would invest 984.00 in DRDGOLD Limited ADR on November 27, 2024 and sell it today you would earn a total of 123.00 from holding DRDGOLD Limited ADR or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altamira Gold Corp vs. DRDGOLD Limited ADR
Performance |
| Timeline |
| Altamira Gold Corp |
| DRDGOLD Limited ADR |
Altamira Gold and DRDGOLD Limited Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altamira Gold and DRDGOLD Limited
The main advantage of trading using opposite Altamira Gold and DRDGOLD Limited positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altamira Gold position performs unexpectedly, DRDGOLD Limited 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 DRDGOLD Limited will offset losses from the drop in DRDGOLD Limited's long position.| Altamira Gold vs. Endurance Gold | Altamira Gold vs. Red Pine Exploration | Altamira Gold vs. Grande Portage Resources | Altamira Gold vs. Tectonic Metals |
| DRDGOLD Limited vs. Osisko Gold Ro | DRDGOLD Limited vs. Eldorado Gold Corp | DRDGOLD Limited vs. SSR Mining | DRDGOLD Limited vs. Idaho Strategic Resources |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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