Correlation Between Gold Bullion and Amundi Nasdaq
Can any of the company-specific risk be diversified away by investing in both Gold Bullion and Amundi Nasdaq 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 Gold Bullion and Amundi Nasdaq into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gold Bullion Securities and Amundi Nasdaq 100 EUR, you can compare the effects of market volatilities on Gold Bullion and Amundi Nasdaq 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 Gold Bullion with a short position of Amundi Nasdaq. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Bullion and Amundi Nasdaq.
Diversification Opportunities for Gold Bullion and Amundi Nasdaq
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gold and Amundi is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Gold Bullion Securities and Amundi Nasdaq 100 EUR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi Nasdaq 100 and Gold Bullion 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 Gold Bullion Securities are associated (or correlated) with Amundi Nasdaq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi Nasdaq 100 has no effect on the direction of Gold Bullion i.e., Gold Bullion and Amundi Nasdaq go up and down completely randomly.
Pair Corralation between Gold Bullion and Amundi Nasdaq
Assuming the 90 days trading horizon Gold Bullion Securities is expected to generate 1.37 times more return on investment than Amundi Nasdaq. However, Gold Bullion is 1.37 times more volatile than Amundi Nasdaq 100 EUR. It trades about 0.21 of its potential returns per unit of risk. Amundi Nasdaq 100 EUR is currently generating about 0.09 per unit of risk. If you would invest 22,580 in Gold Bullion Securities on September 12, 2024 and sell it today you would earn a total of 1,214 from holding Gold Bullion Securities or generate 5.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Gold Bullion Securities vs. Amundi Nasdaq 100 EUR
Performance |
| Timeline |
| Gold Bullion Securities |
| Amundi Nasdaq 100 |
Gold Bullion and Amundi Nasdaq Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Bullion and Amundi Nasdaq
The main advantage of trading using opposite Gold Bullion and Amundi Nasdaq positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Bullion position performs unexpectedly, Amundi Nasdaq 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 Amundi Nasdaq will offset losses from the drop in Amundi Nasdaq's long position.| Gold Bullion vs. Lyxor UCITS Japan | Gold Bullion vs. Lyxor UCITS Japan | Gold Bullion vs. Lyxor UCITS Stoxx | Gold Bullion vs. Amundi CAC 40 |
| Amundi Nasdaq vs. Amundi Index Solutions | Amundi Nasdaq vs. Amundi Index Solutions | Amundi Nasdaq vs. Amundi MSCI World | Amundi Nasdaq vs. Amundi Index Solutions |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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