Correlation Between GoldMining and Austin Gold
Can any of the company-specific risk be diversified away by investing in both GoldMining and Austin 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 GoldMining and Austin Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GoldMining and Austin Gold Corp, you can compare the effects of market volatilities on GoldMining and Austin 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 GoldMining with a short position of Austin Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of GoldMining and Austin Gold.
Diversification Opportunities for GoldMining and Austin Gold
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between GoldMining and Austin is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding GoldMining and Austin Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Austin Gold Corp and GoldMining 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 GoldMining are associated (or correlated) with Austin Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Austin Gold Corp has no effect on the direction of GoldMining i.e., GoldMining and Austin Gold go up and down completely randomly.
Pair Corralation between GoldMining and Austin Gold
Given the investment horizon of 90 days GoldMining is expected to generate 0.3 times more return on investment than Austin Gold. However, GoldMining is 3.33 times less risky than Austin Gold. It trades about -0.12 of its potential returns per unit of risk. Austin Gold Corp is currently generating about -0.11 per unit of risk. If you would invest 93.00 in GoldMining on August 28, 2024 and sell it today you would lose (7.00) from holding GoldMining or give up 7.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GoldMining vs. Austin Gold Corp
Performance |
| Timeline |
| GoldMining |
| Austin Gold Corp |
GoldMining and Austin Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GoldMining and Austin Gold
The main advantage of trading using opposite GoldMining and Austin Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GoldMining position performs unexpectedly, Austin 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 Austin Gold will offset losses from the drop in Austin Gold's long position.| GoldMining vs. Gold Royalty Corp | GoldMining vs. Uranium Royalty Corp | GoldMining vs. Metalla Royalty Streaming | GoldMining vs. Equinox Gold Corp |
| Austin Gold vs. Labrador Gold Corp | Austin Gold vs. Aurion Resources | Austin Gold vs. Puma Exploration | Austin Gold vs. Golden Star Resource |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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