Correlation Between Gold Royalty and Triple Flag
Can any of the company-specific risk be diversified away by investing in both Gold Royalty and Triple Flag 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 Royalty and Triple Flag into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gold Royalty Corp and Triple Flag Precious, you can compare the effects of market volatilities on Gold Royalty and Triple Flag 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 Royalty with a short position of Triple Flag. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Royalty and Triple Flag.
Diversification Opportunities for Gold Royalty and Triple Flag
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gold and Triple is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Gold Royalty Corp and Triple Flag Precious in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triple Flag Precious and Gold Royalty 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 Royalty Corp are associated (or correlated) with Triple Flag. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triple Flag Precious has no effect on the direction of Gold Royalty i.e., Gold Royalty and Triple Flag go up and down completely randomly.
Pair Corralation between Gold Royalty and Triple Flag
Given the investment horizon of 90 days Gold Royalty Corp is expected to under-perform the Triple Flag. In addition to that, Gold Royalty is 1.69 times more volatile than Triple Flag Precious. It trades about -0.3 of its total potential returns per unit of risk. Triple Flag Precious is currently generating about -0.22 per unit of volatility. If you would invest 1,774 in Triple Flag Precious on August 28, 2024 and sell it today you would lose (126.00) from holding Triple Flag Precious or give up 7.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gold Royalty Corp vs. Triple Flag Precious
Performance |
| Timeline |
| Gold Royalty Corp |
| Triple Flag Precious |
Gold Royalty and Triple Flag Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Royalty and Triple Flag
The main advantage of trading using opposite Gold Royalty and Triple Flag positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Royalty position performs unexpectedly, Triple Flag 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 Triple Flag will offset losses from the drop in Triple Flag's long position.| Gold Royalty vs. Endeavour Silver Corp | Gold Royalty vs. SilverCrest Metals | Gold Royalty vs. Platinum Group Metals | Gold Royalty vs. New Pacific Metals |
| Triple Flag vs. Metalla Royalty Streaming | Triple Flag vs. Endeavour Silver Corp | Triple Flag vs. SilverCrest Metals | Triple Flag vs. Gatos Silver |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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