Correlation Between Golden Agri-Resources and Mastermind
Can any of the company-specific risk be diversified away by investing in both Golden Agri-Resources and Mastermind 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 Golden Agri-Resources and Mastermind into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Agri Resources and Mastermind, you can compare the effects of market volatilities on Golden Agri-Resources and Mastermind 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 Golden Agri-Resources with a short position of Mastermind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Agri-Resources and Mastermind.
Diversification Opportunities for Golden Agri-Resources and Mastermind
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Golden and Mastermind is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Golden Agri Resources and Mastermind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mastermind and Golden Agri-Resources 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 Golden Agri Resources are associated (or correlated) with Mastermind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mastermind has no effect on the direction of Golden Agri-Resources i.e., Golden Agri-Resources and Mastermind go up and down completely randomly.
Pair Corralation between Golden Agri-Resources and Mastermind
Assuming the 90 days horizon Golden Agri Resources is expected to generate 0.88 times more return on investment than Mastermind. However, Golden Agri Resources is 1.14 times less risky than Mastermind. It trades about 0.02 of its potential returns per unit of risk. Mastermind is currently generating about -0.01 per unit of risk. If you would invest 19.00 in Golden Agri Resources on January 15, 2025 and sell it today you would lose (1.00) from holding Golden Agri Resources or give up 5.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Golden Agri Resources vs. Mastermind
Performance |
| Timeline |
| Golden Agri Resources |
| Mastermind |
Golden Agri-Resources and Mastermind Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golden Agri-Resources and Mastermind
The main advantage of trading using opposite Golden Agri-Resources and Mastermind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Agri-Resources position performs unexpectedly, Mastermind 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 Mastermind will offset losses from the drop in Mastermind's long position.| Golden Agri-Resources vs. Wilmar International | Golden Agri-Resources vs. SLC Agricola SA | Golden Agri-Resources vs. Brasilagro Adr | Golden Agri-Resources vs. Alico Inc |
| Mastermind vs. Mobivity Holdings | Mastermind vs. Legacy Education Alliance | Mastermind vs. TSS, Common Stock | Mastermind vs. Uniroyal Global Engineered |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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