Correlation Between Golden Metal and Triad Group
Can any of the company-specific risk be diversified away by investing in both Golden Metal and Triad 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 Golden Metal and Triad Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Metal Resources and Triad Group PLC, you can compare the effects of market volatilities on Golden Metal and Triad 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 Golden Metal with a short position of Triad Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Metal and Triad Group.
Diversification Opportunities for Golden Metal and Triad Group
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Golden and Triad is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Golden Metal Resources and Triad Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triad Group PLC and Golden Metal 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 Golden Metal Resources are associated (or correlated) with Triad Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triad Group PLC has no effect on the direction of Golden Metal i.e., Golden Metal and Triad Group go up and down completely randomly.
Pair Corralation between Golden Metal and Triad Group
Assuming the 90 days trading horizon Golden Metal Resources is expected to under-perform the Triad Group. In addition to that, Golden Metal is 1.12 times more volatile than Triad Group PLC. It trades about -0.01 of its total potential returns per unit of risk. Triad Group PLC is currently generating about 0.11 per unit of volatility. If you would invest 32,000 in Triad Group PLC on October 23, 2024 and sell it today you would earn a total of 2,500 from holding Triad Group PLC or generate 7.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Golden Metal Resources vs. Triad Group PLC
Performance |
| Timeline |
| Golden Metal Resources |
| Triad Group PLC |
Golden Metal and Triad Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golden Metal and Triad Group
The main advantage of trading using opposite Golden Metal and Triad Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Metal position performs unexpectedly, Triad 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 Triad Group will offset losses from the drop in Triad Group's long position.| Golden Metal vs. BlackRock Frontiers Investment | Golden Metal vs. Bankers Investment Trust | Golden Metal vs. Software Circle plc | Golden Metal vs. Smithson Investment Trust |
| Triad Group vs. AMG Advanced Metallurgical | Triad Group vs. Cornish Metals | Triad Group vs. Golden Metal Resources | Triad Group vs. Seche Environnement SA |
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 Stocks Directory module to find actively traded stocks across global markets.
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