Correlation Between Altamira Gold and FireFox Gold
Can any of the company-specific risk be diversified away by investing in both Altamira Gold and FireFox Gold 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 FireFox Gold 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 FireFox Gold Corp, you can compare the effects of market volatilities on Altamira Gold and FireFox Gold 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 FireFox Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altamira Gold and FireFox Gold.
Diversification Opportunities for Altamira Gold and FireFox Gold
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Altamira and FireFox is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Altamira Gold Corp and FireFox Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FireFox Gold Corp 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 FireFox Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FireFox Gold Corp has no effect on the direction of Altamira Gold i.e., Altamira Gold and FireFox Gold go up and down completely randomly.
Pair Corralation between Altamira Gold and FireFox Gold
Assuming the 90 days horizon Altamira Gold Corp is expected to under-perform the FireFox Gold. But the pink sheet apears to be less risky and, when comparing its historical volatility, Altamira Gold Corp is 1.21 times less risky than FireFox Gold. The pink sheet trades about -0.31 of its potential returns per unit of risk. The FireFox Gold Corp is currently generating about -0.24 of returns per unit of risk over similar time horizon. If you would invest 3.66 in FireFox Gold Corp on August 25, 2024 and sell it today you would lose (1.05) from holding FireFox Gold Corp or give up 28.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altamira Gold Corp vs. FireFox Gold Corp
Performance |
| Timeline |
| Altamira Gold Corp |
| FireFox Gold Corp |
Altamira Gold and FireFox Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altamira Gold and FireFox Gold
The main advantage of trading using opposite Altamira Gold and FireFox Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altamira Gold position performs unexpectedly, FireFox Gold 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 FireFox Gold will offset losses from the drop in FireFox Gold's long position.| Altamira Gold vs. Aurion Resources | Altamira Gold vs. Liberty Gold Corp | Altamira Gold vs. Rio2 Limited | Altamira Gold vs. Orezone Gold Corp |
| FireFox Gold vs. Aurion Resources | FireFox Gold vs. Liberty Gold Corp | FireFox Gold vs. Rio2 Limited | FireFox Gold vs. Orezone Gold Corp |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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