Correlation Between Metalla Royalty and GoldMoney
Can any of the company-specific risk be diversified away by investing in both Metalla Royalty and GoldMoney 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 Metalla Royalty and GoldMoney into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metalla Royalty Streaming and GoldMoney, you can compare the effects of market volatilities on Metalla Royalty and GoldMoney 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 Metalla Royalty with a short position of GoldMoney. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metalla Royalty and GoldMoney.
Diversification Opportunities for Metalla Royalty and GoldMoney
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Metalla and GoldMoney is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Metalla Royalty Streaming and GoldMoney in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GoldMoney and Metalla Royalty 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 Metalla Royalty Streaming are associated (or correlated) with GoldMoney. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GoldMoney has no effect on the direction of Metalla Royalty i.e., Metalla Royalty and GoldMoney go up and down completely randomly.
Pair Corralation between Metalla Royalty and GoldMoney
Assuming the 90 days horizon Metalla Royalty Streaming is expected to generate 1.64 times more return on investment than GoldMoney. However, Metalla Royalty is 1.64 times more volatile than GoldMoney. It trades about 0.07 of its potential returns per unit of risk. GoldMoney is currently generating about -0.07 per unit of risk. If you would invest 394.00 in Metalla Royalty Streaming on November 29, 2024 and sell it today you would earn a total of 14.00 from holding Metalla Royalty Streaming or generate 3.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metalla Royalty Streaming vs. GoldMoney
Performance |
| Timeline |
| Metalla Royalty Streaming |
| GoldMoney |
Metalla Royalty and GoldMoney Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metalla Royalty and GoldMoney
The main advantage of trading using opposite Metalla Royalty and GoldMoney positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metalla Royalty position performs unexpectedly, GoldMoney 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 GoldMoney will offset losses from the drop in GoldMoney's long position.| Metalla Royalty vs. Sandstorm Gold Ltd | Metalla Royalty vs. EMX Royalty Corp | Metalla Royalty vs. GoldMining |
| GoldMoney vs. GoldMoney | GoldMoney vs. Mene Inc | GoldMoney vs. Wesdome Gold Mines | GoldMoney vs. GoldMining |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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