Correlation Between Altamira Gold and Palamina Corp
Can any of the company-specific risk be diversified away by investing in both Altamira Gold and Palamina Corp 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 Palamina Corp 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 Palamina Corp, you can compare the effects of market volatilities on Altamira Gold and Palamina Corp 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 Palamina Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altamira Gold and Palamina Corp.
Diversification Opportunities for Altamira Gold and Palamina Corp
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Altamira and Palamina is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Altamira Gold Corp and Palamina Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Palamina 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 Palamina Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Palamina Corp has no effect on the direction of Altamira Gold i.e., Altamira Gold and Palamina Corp go up and down completely randomly.
Pair Corralation between Altamira Gold and Palamina Corp
Assuming the 90 days horizon Altamira Gold Corp is expected to generate 0.42 times more return on investment than Palamina Corp. However, Altamira Gold Corp is 2.37 times less risky than Palamina Corp. It trades about -0.31 of its potential returns per unit of risk. Palamina Corp is currently generating about -0.18 per unit of risk. If you would invest 13.00 in Altamira Gold Corp on August 25, 2024 and sell it today you would lose (3.90) from holding Altamira Gold Corp or give up 30.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altamira Gold Corp vs. Palamina Corp
Performance |
| Timeline |
| Altamira Gold Corp |
| Palamina Corp |
Altamira Gold and Palamina Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altamira Gold and Palamina Corp
The main advantage of trading using opposite Altamira Gold and Palamina Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altamira Gold position performs unexpectedly, Palamina Corp 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 Palamina Corp will offset losses from the drop in Palamina Corp'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 |
| Palamina Corp vs. Gold Springs Resource | Palamina Corp vs. BTU Metals Corp | Palamina Corp vs. Norsemont Mining | Palamina Corp vs. FireFox 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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