Correlation Between Fuji Media and Gold Road
Can any of the company-specific risk be diversified away by investing in both Fuji Media and Gold Road 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 Fuji Media and Gold Road into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fuji Media Holdings and Gold Road Resources, you can compare the effects of market volatilities on Fuji Media and Gold Road 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 Fuji Media with a short position of Gold Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fuji Media and Gold Road.
Diversification Opportunities for Fuji Media and Gold Road
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Fuji and Gold is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Fuji Media Holdings and Gold Road Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Road Resources and Fuji Media 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 Fuji Media Holdings are associated (or correlated) with Gold Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Road Resources has no effect on the direction of Fuji Media i.e., Fuji Media and Gold Road go up and down completely randomly.
Pair Corralation between Fuji Media and Gold Road
Assuming the 90 days trading horizon Fuji Media Holdings is expected to under-perform the Gold Road. In addition to that, Fuji Media is 1.4 times more volatile than Gold Road Resources. It trades about -0.1 of its total potential returns per unit of risk. Gold Road Resources is currently generating about 0.14 per unit of volatility. If you would invest 124.00 in Gold Road Resources on October 16, 2024 and sell it today you would earn a total of 5.00 from holding Gold Road Resources or generate 4.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fuji Media Holdings vs. Gold Road Resources
Performance |
| Timeline |
| Fuji Media Holdings |
| Gold Road Resources |
Fuji Media and Gold Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fuji Media and Gold Road
The main advantage of trading using opposite Fuji Media and Gold Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fuji Media position performs unexpectedly, Gold Road 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 Gold Road will offset losses from the drop in Gold Road's long position.| Fuji Media vs. COLUMBIA SPORTSWEAR | Fuji Media vs. PEPTONIC MEDICAL | Fuji Media vs. ePlay Digital | Fuji Media vs. ONWARD MEDICAL BV |
| Gold Road vs. Pure Storage | Gold Road vs. Monument Mining Limited | Gold Road vs. Linedata Services SA | Gold Road vs. Teradata 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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