Correlation Between Fremont Gold and Loncor Gold
Can any of the company-specific risk be diversified away by investing in both Fremont Gold and Loncor 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 Fremont Gold and Loncor Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fremont Gold and Loncor Gold, you can compare the effects of market volatilities on Fremont Gold and Loncor 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 Fremont Gold with a short position of Loncor Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fremont Gold and Loncor Gold.
Diversification Opportunities for Fremont Gold and Loncor Gold
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Fremont and Loncor is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Fremont Gold and Loncor Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loncor Gold and Fremont 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 Fremont Gold are associated (or correlated) with Loncor Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loncor Gold has no effect on the direction of Fremont Gold i.e., Fremont Gold and Loncor Gold go up and down completely randomly.
Pair Corralation between Fremont Gold and Loncor Gold
If you would invest 11.00 in Fremont Gold on October 26, 2024 and sell it today you would lose (2.87) from holding Fremont Gold or give up 26.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 2.56% |
| Values | Daily Returns |
Fremont Gold vs. Loncor Gold
Performance |
| Timeline |
| Fremont Gold |
| Loncor Gold |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Fremont Gold and Loncor Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fremont Gold and Loncor Gold
The main advantage of trading using opposite Fremont Gold and Loncor Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fremont Gold position performs unexpectedly, Loncor 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 Loncor Gold will offset losses from the drop in Loncor Gold's long position.| Fremont Gold vs. Altamira Gold Corp | Fremont Gold vs. Rio2 Limited | Fremont Gold vs. Novo Resources Corp | Fremont Gold vs. Lion One Metals |
| Loncor Gold vs. Galiano Gold | Loncor Gold vs. Brunswick Exploration | Loncor Gold vs. B2Gold Corp | Loncor Gold vs. Japan 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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