Correlation Between MTY Food and AuQ Gold
Can any of the company-specific risk be diversified away by investing in both MTY Food and AuQ 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 MTY Food and AuQ Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MTY Food Group and AuQ Gold Mining, you can compare the effects of market volatilities on MTY Food and AuQ 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 MTY Food with a short position of AuQ Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of MTY Food and AuQ Gold.
Diversification Opportunities for MTY Food and AuQ Gold
Poor diversification
The 3 months correlation between MTY and AuQ is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding MTY Food Group and AuQ Gold Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AuQ Gold Mining and MTY Food 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 MTY Food Group are associated (or correlated) with AuQ Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AuQ Gold Mining has no effect on the direction of MTY Food i.e., MTY Food and AuQ Gold go up and down completely randomly.
Pair Corralation between MTY Food and AuQ Gold
Assuming the 90 days trading horizon MTY Food Group is expected to under-perform the AuQ Gold. But the stock apears to be less risky and, when comparing its historical volatility, MTY Food Group is 4.91 times less risky than AuQ Gold. The stock trades about -0.02 of its potential returns per unit of risk. The AuQ Gold Mining is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 14.00 in AuQ Gold Mining on September 4, 2024 and sell it today you would earn a total of 8.00 from holding AuQ Gold Mining or generate 57.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.73% |
| Values | Daily Returns |
MTY Food Group vs. AuQ Gold Mining
Performance |
| Timeline |
| MTY Food Group |
| AuQ Gold Mining |
MTY Food and AuQ Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MTY Food and AuQ Gold
The main advantage of trading using opposite MTY Food and AuQ Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MTY Food position performs unexpectedly, AuQ 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 AuQ Gold will offset losses from the drop in AuQ Gold's long position.| MTY Food vs. Restaurant Brands International | MTY Food vs. Enghouse Systems | MTY Food vs. Metro Inc | MTY Food vs. BRP Inc |
| AuQ Gold vs. Exco Technologies Limited | AuQ Gold vs. Data Communications Management | AuQ Gold vs. Quorum Information Technologies | AuQ Gold vs. MTY Food Group |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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