Correlation Between Galiano Gold and Sibanye Stillwater
Can any of the company-specific risk be diversified away by investing in both Galiano Gold and Sibanye Stillwater 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 Sibanye Stillwater into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Galiano Gold and Sibanye Stillwater Limited, you can compare the effects of market volatilities on Galiano Gold and Sibanye Stillwater 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 Sibanye Stillwater. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galiano Gold and Sibanye Stillwater.
Diversification Opportunities for Galiano Gold and Sibanye Stillwater
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Galiano and Sibanye is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Galiano Gold and Sibanye Stillwater Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sibanye Stillwater 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 Sibanye Stillwater. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sibanye Stillwater has no effect on the direction of Galiano Gold i.e., Galiano Gold and Sibanye Stillwater go up and down completely randomly.
Pair Corralation between Galiano Gold and Sibanye Stillwater
Considering the 90-day investment horizon Galiano Gold is expected to generate 0.58 times more return on investment than Sibanye Stillwater. However, Galiano Gold is 1.72 times less risky than Sibanye Stillwater. It trades about 0.06 of its potential returns per unit of risk. Sibanye Stillwater Limited is currently generating about -0.01 per unit of risk. If you would invest 56.00 in Galiano Gold on October 7, 2024 and sell it today you would earn a total of 74.00 from holding Galiano Gold or generate 132.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Galiano Gold vs. Sibanye Stillwater Limited
Performance |
| Timeline |
| Galiano Gold |
| Sibanye Stillwater |
Galiano Gold and Sibanye Stillwater Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Galiano Gold and Sibanye Stillwater
The main advantage of trading using opposite Galiano Gold and Sibanye Stillwater positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Galiano Gold position performs unexpectedly, Sibanye Stillwater 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 Sibanye Stillwater will offset losses from the drop in Sibanye Stillwater'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 |
| Sibanye Stillwater vs. Vior Inc | Sibanye Stillwater vs. Peloton Minerals | Sibanye Stillwater vs. BTU Metals Corp | Sibanye Stillwater vs. Palamina 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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