Correlation Between MetLife and Avidian Gold
Can any of the company-specific risk be diversified away by investing in both MetLife and Avidian Gold 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 MetLife and Avidian Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MetLife and Avidian Gold Corp, you can compare the effects of market volatilities on MetLife and Avidian Gold 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 MetLife with a short position of Avidian Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of MetLife and Avidian Gold.
Diversification Opportunities for MetLife and Avidian Gold
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MetLife and Avidian is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding MetLife and Avidian Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avidian Gold Corp and MetLife 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 MetLife are associated (or correlated) with Avidian Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avidian Gold Corp has no effect on the direction of MetLife i.e., MetLife and Avidian Gold go up and down completely randomly.
Pair Corralation between MetLife and Avidian Gold
Considering the 90-day investment horizon MetLife is expected to generate 2.24 times less return on investment than Avidian Gold. But when comparing it to its historical volatility, MetLife is 11.83 times less risky than Avidian Gold. It trades about 0.36 of its potential returns per unit of risk. Avidian Gold Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 9.62 in Avidian Gold Corp on September 3, 2024 and sell it today you would lose (0.36) from holding Avidian Gold Corp or give up 3.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
MetLife vs. Avidian Gold Corp
Performance |
| Timeline |
| MetLife |
| Avidian Gold Corp |
MetLife and Avidian Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MetLife and Avidian Gold
The main advantage of trading using opposite MetLife and Avidian Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MetLife position performs unexpectedly, Avidian Gold 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 Avidian Gold will offset losses from the drop in Avidian Gold's long position.| MetLife vs. Lincoln National | MetLife vs. Aflac Incorporated | MetLife vs. Unum Group | MetLife vs. Manulife Financial Corp |
| Avidian Gold vs. Harmony Gold Mining | Avidian Gold vs. SPACE | Avidian Gold vs. T Rowe Price | Avidian Gold vs. Ampleforth |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |