Correlation Between Golden Agri-Resources and Minerva SA
Can any of the company-specific risk be diversified away by investing in both Golden Agri-Resources and Minerva SA 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 Minerva SA 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 Minerva SA, you can compare the effects of market volatilities on Golden Agri-Resources and Minerva SA 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 Minerva SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Agri-Resources and Minerva SA.
Diversification Opportunities for Golden Agri-Resources and Minerva SA
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Golden and Minerva is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Golden Agri Resources and Minerva SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minerva SA 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 Minerva SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minerva SA has no effect on the direction of Golden Agri-Resources i.e., Golden Agri-Resources and Minerva SA go up and down completely randomly.
Pair Corralation between Golden Agri-Resources and Minerva SA
Assuming the 90 days horizon Golden Agri Resources is expected to generate 0.98 times more return on investment than Minerva SA. However, Golden Agri Resources is 1.02 times less risky than Minerva SA. It trades about 0.02 of its potential returns per unit of risk. Minerva SA is currently generating about -0.04 per unit of risk. If you would invest 20.00 in Golden Agri Resources on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Golden Agri Resources or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Golden Agri Resources vs. Minerva SA
Performance |
| Timeline |
| Golden Agri Resources |
| Minerva SA |
Golden Agri-Resources and Minerva SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golden Agri-Resources and Minerva SA
The main advantage of trading using opposite Golden Agri-Resources and Minerva SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Agri-Resources position performs unexpectedly, Minerva SA 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 Minerva SA will offset losses from the drop in Minerva SA's long position.| Golden Agri-Resources vs. Artisan Consumer Goods | Golden Agri-Resources vs. Altavoz Entertainment | Golden Agri-Resources vs. Avi Ltd ADR | Golden Agri-Resources vs. Aryzta AG PK |
| Minerva SA vs. Artisan Consumer Goods | Minerva SA vs. Altavoz Entertainment | Minerva SA vs. Avi Ltd ADR | Minerva SA vs. Aryzta AG PK |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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