Correlation Between Goliath Resources and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Goliath Resources and Dow Jones 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 Goliath Resources and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goliath Resources and Dow Jones Industrial, you can compare the effects of market volatilities on Goliath Resources and Dow Jones 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 Goliath Resources with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goliath Resources and Dow Jones.
Diversification Opportunities for Goliath Resources and Dow Jones
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Goliath and Dow is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Goliath Resources and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Goliath Resources 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 Goliath Resources are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Goliath Resources i.e., Goliath Resources and Dow Jones go up and down completely randomly.
Pair Corralation between Goliath Resources and Dow Jones
Assuming the 90 days horizon Goliath Resources is expected to generate 5.73 times more return on investment than Dow Jones. However, Goliath Resources is 5.73 times more volatile than Dow Jones Industrial. It trades about 0.02 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of risk. If you would invest 106.00 in Goliath Resources on September 2, 2024 and sell it today you would earn a total of 8.00 from holding Goliath Resources or generate 7.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goliath Resources vs. Dow Jones Industrial
Performance |
| Timeline |
Goliath Resources and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Goliath Resources
Pair trading matchups for Goliath Resources
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Goliath Resources and Dow Jones
The main advantage of trading using opposite Goliath Resources and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goliath Resources position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Goliath Resources vs. Eskay Mining Corp | Goliath Resources vs. Lion One Metals | Goliath Resources vs. Cassiar Gold Corp | Goliath Resources vs. Blackrock Silver Corp |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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