Correlation Between Altamira Gold and Wesdome Gold
Can any of the company-specific risk be diversified away by investing in both Altamira Gold and Wesdome 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 Wesdome 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 Wesdome Gold Mines, you can compare the effects of market volatilities on Altamira Gold and Wesdome 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 Wesdome Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altamira Gold and Wesdome Gold.
Diversification Opportunities for Altamira Gold and Wesdome Gold
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Altamira and Wesdome is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Altamira Gold Corp and Wesdome Gold Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wesdome Gold Mines 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 Wesdome Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wesdome Gold Mines has no effect on the direction of Altamira Gold i.e., Altamira Gold and Wesdome Gold go up and down completely randomly.
Pair Corralation between Altamira Gold and Wesdome Gold
Assuming the 90 days horizon Altamira Gold Corp is expected to generate 1.96 times more return on investment than Wesdome Gold. However, Altamira Gold is 1.96 times more volatile than Wesdome Gold Mines. It trades about 0.11 of its potential returns per unit of risk. Wesdome Gold Mines is currently generating about -0.13 per unit of risk. If you would invest 8.40 in Altamira Gold Corp on October 13, 2024 and sell it today you would earn a total of 0.60 from holding Altamira Gold Corp or generate 7.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altamira Gold Corp vs. Wesdome Gold Mines
Performance |
| Timeline |
| Altamira Gold Corp |
| Wesdome Gold Mines |
Altamira Gold and Wesdome Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altamira Gold and Wesdome Gold
The main advantage of trading using opposite Altamira Gold and Wesdome Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altamira Gold position performs unexpectedly, Wesdome 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 Wesdome Gold will offset losses from the drop in Wesdome Gold'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 |
| Wesdome Gold vs. Victoria Gold Corp | Wesdome Gold vs. Cassiar Gold Corp | Wesdome Gold vs. Liberty Gold Corp | Wesdome Gold vs. I 80 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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