Correlation Between Galiano Gold and NV Gold
Can any of the company-specific risk be diversified away by investing in both Galiano Gold and NV 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 Galiano Gold and NV Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Galiano Gold and NV Gold, you can compare the effects of market volatilities on Galiano Gold and NV 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 Galiano Gold with a short position of NV Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galiano Gold and NV Gold.
Diversification Opportunities for Galiano Gold and NV Gold
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Galiano and NVGLF is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Galiano Gold and NV Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NV Gold and Galiano 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 Galiano Gold are associated (or correlated) with NV Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NV Gold has no effect on the direction of Galiano Gold i.e., Galiano Gold and NV Gold go up and down completely randomly.
Pair Corralation between Galiano Gold and NV Gold
Considering the 90-day investment horizon Galiano Gold is expected to generate 0.42 times more return on investment than NV Gold. However, Galiano Gold is 2.38 times less risky than NV Gold. It trades about -0.05 of its potential returns per unit of risk. NV Gold is currently generating about -0.15 per unit of risk. If you would invest 140.00 in Galiano Gold on September 12, 2024 and sell it today you would lose (6.00) from holding Galiano Gold or give up 4.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Galiano Gold vs. NV Gold
Performance |
| Timeline |
| Galiano Gold |
| NV Gold |
Galiano Gold and NV Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Galiano Gold and NV Gold
The main advantage of trading using opposite Galiano Gold and NV Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Galiano Gold position performs unexpectedly, NV 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 NV Gold will offset losses from the drop in NV Gold's long position.| Galiano Gold vs. Avino Silver Gold | Galiano Gold vs. Americas Silver Corp | Galiano Gold vs. Paramount Gold Nevada | Galiano Gold vs. Fury Gold Mines |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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