Correlation Between Galantas Gold and Mundoro Capital
Can any of the company-specific risk be diversified away by investing in both Galantas Gold and Mundoro Capital 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 Galantas Gold and Mundoro Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Galantas Gold Corp and Mundoro Capital, you can compare the effects of market volatilities on Galantas Gold and Mundoro Capital 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 Galantas Gold with a short position of Mundoro Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galantas Gold and Mundoro Capital.
Diversification Opportunities for Galantas Gold and Mundoro Capital
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Galantas and Mundoro is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Galantas Gold Corp and Mundoro Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mundoro Capital and Galantas 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 Galantas Gold Corp are associated (or correlated) with Mundoro Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mundoro Capital has no effect on the direction of Galantas Gold i.e., Galantas Gold and Mundoro Capital go up and down completely randomly.
Pair Corralation between Galantas Gold and Mundoro Capital
Assuming the 90 days horizon Galantas Gold Corp is expected to under-perform the Mundoro Capital. In addition to that, Galantas Gold is 1.96 times more volatile than Mundoro Capital. It trades about -0.02 of its total potential returns per unit of risk. Mundoro Capital is currently generating about 0.03 per unit of volatility. If you would invest 16.00 in Mundoro Capital on September 12, 2024 and sell it today you would earn a total of 2.00 from holding Mundoro Capital or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Galantas Gold Corp vs. Mundoro Capital
Performance |
| Timeline |
| Galantas Gold Corp |
| Mundoro Capital |
Galantas Gold and Mundoro Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Galantas Gold and Mundoro Capital
The main advantage of trading using opposite Galantas Gold and Mundoro Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Galantas Gold position performs unexpectedly, Mundoro Capital 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 Mundoro Capital will offset losses from the drop in Mundoro Capital's long position.| Galantas Gold vs. Ressources Minieres Radisson | Galantas Gold vs. Red Pine Exploration | Galantas Gold vs. Kore Mining |
| Mundoro Capital vs. Ressources Minieres Radisson | Mundoro Capital vs. Galantas Gold Corp | Mundoro Capital vs. Red Pine Exploration | Mundoro Capital vs. Kore Mining |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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