Correlation Between Gold Fields and Dacian Gold
Can any of the company-specific risk be diversified away by investing in both Gold Fields and Dacian 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 Gold Fields and Dacian Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gold Fields Ltd and Dacian Gold Limited, you can compare the effects of market volatilities on Gold Fields and Dacian 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 Gold Fields with a short position of Dacian Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Fields and Dacian Gold.
Diversification Opportunities for Gold Fields and Dacian Gold
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gold and Dacian is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Gold Fields Ltd and Dacian Gold Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dacian Gold Limited and Gold Fields 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 Fields Ltd are associated (or correlated) with Dacian Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dacian Gold Limited has no effect on the direction of Gold Fields i.e., Gold Fields and Dacian Gold go up and down completely randomly.
Pair Corralation between Gold Fields and Dacian Gold
If you would invest 6.01 in Dacian Gold Limited on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Dacian Gold Limited or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Gold Fields Ltd vs. Dacian Gold Limited
Performance |
| Timeline |
| Gold Fields |
| Dacian Gold Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Gold Fields and Dacian Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Fields and Dacian Gold
The main advantage of trading using opposite Gold Fields and Dacian Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Fields position performs unexpectedly, Dacian 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 Dacian Gold will offset losses from the drop in Dacian Gold's long position.| Gold Fields vs. Agnico Eagle Mines | Gold Fields vs. Kinross Gold | Gold Fields vs. Harmony Gold Mining | Gold Fields vs. Franco Nevada |
| Dacian Gold vs. Minnova Corp | Dacian Gold vs. Argo Gold | Dacian Gold vs. Advance Gold Corp | Dacian Gold vs. Blue Star Gold |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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