Correlation Between Loncor Gold and Collective Mining
Can any of the company-specific risk be diversified away by investing in both Loncor Gold and Collective Mining 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 Loncor Gold and Collective Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Loncor Gold and Collective Mining, you can compare the effects of market volatilities on Loncor Gold and Collective Mining 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 Loncor Gold with a short position of Collective Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loncor Gold and Collective Mining.
Diversification Opportunities for Loncor Gold and Collective Mining
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Loncor and Collective is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Loncor Gold and Collective Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Collective Mining and Loncor 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 Loncor Gold are associated (or correlated) with Collective Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Collective Mining has no effect on the direction of Loncor Gold i.e., Loncor Gold and Collective Mining go up and down completely randomly.
Pair Corralation between Loncor Gold and Collective Mining
If you would invest 277.00 in Collective Mining on August 27, 2024 and sell it today you would earn a total of 68.00 from holding Collective Mining or generate 24.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 1.11% |
| Values | Daily Returns |
Loncor Gold vs. Collective Mining
Performance |
| Timeline |
| Loncor Gold |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Collective Mining |
Loncor Gold and Collective Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loncor Gold and Collective Mining
The main advantage of trading using opposite Loncor Gold and Collective Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loncor Gold position performs unexpectedly, Collective Mining 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 Collective Mining will offset losses from the drop in Collective Mining's long position.| Loncor Gold vs. Galiano Gold | Loncor Gold vs. Brunswick Exploration | Loncor Gold vs. B2Gold Corp | Loncor Gold vs. Japan Gold Corp |
| Collective Mining vs. Nova Minerals Limited | Collective Mining vs. Nova Minerals Limited | Collective Mining vs. Solaris Resources | Collective Mining vs. MGE Energy |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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