Correlation Between Gold and Platinum Group
Can any of the company-specific risk be diversified away by investing in both Gold and Platinum Group 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 and Platinum Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gold And Gemstone and Platinum Group Metals, you can compare the effects of market volatilities on Gold and Platinum Group 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 with a short position of Platinum Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold and Platinum Group.
Diversification Opportunities for Gold and Platinum Group
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Gold and Platinum is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Gold And Gemstone and Platinum Group Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Platinum Group Metals and 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 Gold And Gemstone are associated (or correlated) with Platinum Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Platinum Group Metals has no effect on the direction of Gold i.e., Gold and Platinum Group go up and down completely randomly.
Pair Corralation between Gold and Platinum Group
Given the investment horizon of 90 days Gold And Gemstone is expected to generate 3.2 times more return on investment than Platinum Group. However, Gold is 3.2 times more volatile than Platinum Group Metals. It trades about -0.01 of its potential returns per unit of risk. Platinum Group Metals is currently generating about -0.19 per unit of risk. If you would invest 0.08 in Gold And Gemstone on August 29, 2024 and sell it today you would lose (0.02) from holding Gold And Gemstone or give up 25.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Gold And Gemstone vs. Platinum Group Metals
Performance |
| Timeline |
| Gold And Gemstone |
| Platinum Group Metals |
Gold and Platinum Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold and Platinum Group
The main advantage of trading using opposite Gold and Platinum Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold position performs unexpectedly, Platinum Group 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 Platinum Group will offset losses from the drop in Platinum Group's long position.| Gold vs. Silver Hammer Mining | Gold vs. Reyna Silver Corp | Gold vs. Guanajuato Silver | Gold vs. Silver One Resources |
| Platinum Group vs. Endeavour Silver Corp | Platinum Group vs. Avino Silver Gold | Platinum Group vs. Fortuna Silver Mines | Platinum Group vs. Impala Platinum Holdings |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |