Correlation Between Naked Wines and Eldorado Gold
Can any of the company-specific risk be diversified away by investing in both Naked Wines and Eldorado 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 Naked Wines and Eldorado Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Naked Wines plc and Eldorado Gold Corp, you can compare the effects of market volatilities on Naked Wines and Eldorado 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 Naked Wines with a short position of Eldorado Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Naked Wines and Eldorado Gold.
Diversification Opportunities for Naked Wines and Eldorado Gold
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Naked and Eldorado is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Naked Wines plc and Eldorado Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eldorado Gold Corp and Naked Wines 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 Naked Wines plc are associated (or correlated) with Eldorado Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eldorado Gold Corp has no effect on the direction of Naked Wines i.e., Naked Wines and Eldorado Gold go up and down completely randomly.
Pair Corralation between Naked Wines and Eldorado Gold
Assuming the 90 days horizon Naked Wines plc is expected to under-perform the Eldorado Gold. But the pink sheet apears to be less risky and, when comparing its historical volatility, Naked Wines plc is 1.72 times less risky than Eldorado Gold. The pink sheet trades about -0.05 of its potential returns per unit of risk. The Eldorado Gold Corp is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,635 in Eldorado Gold Corp on September 2, 2024 and sell it today you would lose (35.00) from holding Eldorado Gold Corp or give up 2.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
Naked Wines plc vs. Eldorado Gold Corp
Performance |
| Timeline |
| Naked Wines plc |
| Eldorado Gold Corp |
Naked Wines and Eldorado Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Naked Wines and Eldorado Gold
The main advantage of trading using opposite Naked Wines and Eldorado Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Naked Wines position performs unexpectedly, Eldorado 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 Eldorado Gold will offset losses from the drop in Eldorado Gold's long position.| Naked Wines vs. Diageo PLC ADR | Naked Wines vs. Pernod Ricard SA | Naked Wines vs. Constellation Brands Class | Naked Wines vs. Brown Forman |
| Eldorado Gold vs. IAMGold | Eldorado Gold vs. Kinross Gold | Eldorado Gold vs. Agnico Eagle Mines | Eldorado Gold vs. Gold Fields Ltd |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |