Correlation Between Liberty Gold and Minera Alamos
Can any of the company-specific risk be diversified away by investing in both Liberty Gold and Minera Alamos 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 Liberty Gold and Minera Alamos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty Gold Corp and Minera Alamos, you can compare the effects of market volatilities on Liberty Gold and Minera Alamos 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 Liberty Gold with a short position of Minera Alamos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Gold and Minera Alamos.
Diversification Opportunities for Liberty Gold and Minera Alamos
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Liberty and Minera is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Gold Corp and Minera Alamos in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minera Alamos and Liberty Gold 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 Liberty Gold Corp are associated (or correlated) with Minera Alamos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minera Alamos has no effect on the direction of Liberty Gold i.e., Liberty Gold and Minera Alamos go up and down completely randomly.
Pair Corralation between Liberty Gold and Minera Alamos
Assuming the 90 days trading horizon Liberty Gold is expected to generate 1.3 times less return on investment than Minera Alamos. In addition to that, Liberty Gold is 1.05 times more volatile than Minera Alamos. It trades about 0.01 of its total potential returns per unit of risk. Minera Alamos is currently generating about 0.01 per unit of volatility. If you would invest 32.00 in Minera Alamos on August 26, 2024 and sell it today you would lose (3.00) from holding Minera Alamos or give up 9.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liberty Gold Corp vs. Minera Alamos
Performance |
| Timeline |
| Liberty Gold Corp |
| Minera Alamos |
Liberty Gold and Minera Alamos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liberty Gold and Minera Alamos
The main advantage of trading using opposite Liberty Gold and Minera Alamos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty Gold position performs unexpectedly, Minera Alamos 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 Minera Alamos will offset losses from the drop in Minera Alamos' long position.| Liberty Gold vs. GoGold Resources | Liberty Gold vs. Maple Gold Mines | Liberty Gold vs. Aurion Resources | Liberty Gold vs. Minaurum Gold |
| Minera Alamos vs. First Majestic Silver | Minera Alamos vs. Ivanhoe Energy | Minera Alamos vs. Orezone Gold Corp | Minera Alamos vs. Faraday Copper Corp |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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