Correlation Between Gold Fields and ChipMOS Technologies
Can any of the company-specific risk be diversified away by investing in both Gold Fields and ChipMOS Technologies 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 ChipMOS Technologies 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 ChipMOS Technologies, you can compare the effects of market volatilities on Gold Fields and ChipMOS Technologies 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 ChipMOS Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Fields and ChipMOS Technologies.
Diversification Opportunities for Gold Fields and ChipMOS Technologies
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Gold and ChipMOS is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Gold Fields Ltd and ChipMOS Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChipMOS Technologies 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 ChipMOS Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChipMOS Technologies has no effect on the direction of Gold Fields i.e., Gold Fields and ChipMOS Technologies go up and down completely randomly.
Pair Corralation between Gold Fields and ChipMOS Technologies
Considering the 90-day investment horizon Gold Fields Ltd is expected to generate 0.72 times more return on investment than ChipMOS Technologies. However, Gold Fields Ltd is 1.38 times less risky than ChipMOS Technologies. It trades about 0.46 of its potential returns per unit of risk. ChipMOS Technologies is currently generating about 0.2 per unit of risk. If you would invest 1,529 in Gold Fields Ltd on November 18, 2024 and sell it today you would earn a total of 358.00 from holding Gold Fields Ltd or generate 23.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gold Fields Ltd vs. ChipMOS Technologies
Performance |
| Timeline |
| Gold Fields |
| ChipMOS Technologies |
Gold Fields and ChipMOS Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Fields and ChipMOS Technologies
The main advantage of trading using opposite Gold Fields and ChipMOS Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Fields position performs unexpectedly, ChipMOS Technologies 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 ChipMOS Technologies will offset losses from the drop in ChipMOS Technologies' long position.| Gold Fields vs. Agnico Eagle Mines | Gold Fields vs. Kinross Gold | Gold Fields vs. Harmony Gold Mining | Gold Fields vs. Franco Nevada |
| ChipMOS Technologies vs. Nano Labs | ChipMOS Technologies vs. Wisekey International Holding | ChipMOS Technologies vs. Silicon Motion Technology | ChipMOS Technologies vs. United Microelectronics |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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