Correlation Between Manitou BF and Gold Bullion
Can any of the company-specific risk be diversified away by investing in both Manitou BF and Gold Bullion 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 Manitou BF and Gold Bullion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manitou BF SA and Gold Bullion Securities, you can compare the effects of market volatilities on Manitou BF and Gold Bullion 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 Manitou BF with a short position of Gold Bullion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manitou BF and Gold Bullion.
Diversification Opportunities for Manitou BF and Gold Bullion
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Manitou and Gold is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Manitou BF SA and Gold Bullion Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Bullion Securities and Manitou BF 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 Manitou BF SA are associated (or correlated) with Gold Bullion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Bullion Securities has no effect on the direction of Manitou BF i.e., Manitou BF and Gold Bullion go up and down completely randomly.
Pair Corralation between Manitou BF and Gold Bullion
Assuming the 90 days trading horizon Manitou BF SA is expected to under-perform the Gold Bullion. In addition to that, Manitou BF is 1.61 times more volatile than Gold Bullion Securities. It trades about -0.18 of its total potential returns per unit of risk. Gold Bullion Securities is currently generating about -0.01 per unit of volatility. If you would invest 23,255 in Gold Bullion Securities on September 2, 2024 and sell it today you would lose (76.00) from holding Gold Bullion Securities or give up 0.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Manitou BF SA vs. Gold Bullion Securities
Performance |
| Timeline |
| Manitou BF SA |
| Gold Bullion Securities |
Manitou BF and Gold Bullion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manitou BF and Gold Bullion
The main advantage of trading using opposite Manitou BF and Gold Bullion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manitou BF position performs unexpectedly, Gold Bullion 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 Gold Bullion will offset losses from the drop in Gold Bullion's long position.| Manitou BF vs. Air Liquide SA | Manitou BF vs. Vinci SA | Manitou BF vs. LOreal SA | Manitou BF vs. Compagnie de Saint Gobain |
| Gold Bullion vs. Manitou BF SA | Gold Bullion vs. Granite 3x LVMH | Gold Bullion vs. 21Shares Polkadot ETP | Gold Bullion vs. Ekinops SA |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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