Correlation Between Goliath Resources and New Found
Can any of the company-specific risk be diversified away by investing in both Goliath Resources and New Found 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 New Found into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goliath Resources and New Found Gold, you can compare the effects of market volatilities on Goliath Resources and New Found 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 New Found. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goliath Resources and New Found.
Diversification Opportunities for Goliath Resources and New Found
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Goliath and New is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Goliath Resources and New Found Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Found Gold 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 New Found. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Found Gold has no effect on the direction of Goliath Resources i.e., Goliath Resources and New Found go up and down completely randomly.
Pair Corralation between Goliath Resources and New Found
Assuming the 90 days horizon Goliath Resources is expected to generate 0.9 times more return on investment than New Found. However, Goliath Resources is 1.11 times less risky than New Found. It trades about 0.05 of its potential returns per unit of risk. New Found Gold is currently generating about -0.1 per unit of risk. If you would invest 99.00 in Goliath Resources on September 1, 2024 and sell it today you would earn a total of 15.00 from holding Goliath Resources or generate 15.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goliath Resources vs. New Found Gold
Performance |
| Timeline |
| Goliath Resources |
| New Found Gold |
Goliath Resources and New Found Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goliath Resources and New Found
The main advantage of trading using opposite Goliath Resources and New Found positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goliath Resources position performs unexpectedly, New Found 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 New Found will offset losses from the drop in New Found's 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 |
| New Found vs. Oculus VisionTech | New Found vs. CNJ Capital Investments | New Found vs. Quisitive Technology Solutions | New Found vs. Cogeco Communications |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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