Correlation Between Loncor Gold and TRU Precious
Can any of the company-specific risk be diversified away by investing in both Loncor Gold and TRU Precious 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 TRU Precious into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Loncor Gold and TRU Precious Metals, you can compare the effects of market volatilities on Loncor Gold and TRU Precious 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 TRU Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loncor Gold and TRU Precious.
Diversification Opportunities for Loncor Gold and TRU Precious
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Loncor and TRU is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Loncor Gold and TRU Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRU Precious Metals 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 TRU Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRU Precious Metals has no effect on the direction of Loncor Gold i.e., Loncor Gold and TRU Precious go up and down completely randomly.
Pair Corralation between Loncor Gold and TRU Precious
If you would invest 2.00 in TRU Precious Metals on August 29, 2024 and sell it today you would lose (0.58) from holding TRU Precious Metals or give up 29.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 2.38% |
| Values | Daily Returns |
Loncor Gold vs. TRU Precious Metals
Performance |
| Timeline |
| Loncor Gold |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| TRU Precious Metals |
Loncor Gold and TRU Precious Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loncor Gold and TRU Precious
The main advantage of trading using opposite Loncor Gold and TRU Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loncor Gold position performs unexpectedly, TRU Precious 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 TRU Precious will offset losses from the drop in TRU Precious' long position.| Loncor Gold vs. Galiano Gold | Loncor Gold vs. Brunswick Exploration | Loncor Gold vs. B2Gold Corp | Loncor Gold vs. Japan Gold Corp |
| TRU Precious vs. Lavras Gold Corp | TRU Precious vs. Orefinders Resources | TRU Precious vs. North Peak Resources | TRU Precious vs. Nine Mile Metals |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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