Correlation Between Matador Mining and Fremont Gold
Can any of the company-specific risk be diversified away by investing in both Matador Mining and Fremont 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 Matador Mining and Fremont Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Matador Mining Limited and Fremont Gold, you can compare the effects of market volatilities on Matador Mining and Fremont 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 Matador Mining with a short position of Fremont Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Matador Mining and Fremont Gold.
Diversification Opportunities for Matador Mining and Fremont Gold
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Matador and Fremont is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Matador Mining Limited and Fremont Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fremont Gold and Matador Mining 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 Matador Mining Limited are associated (or correlated) with Fremont Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fremont Gold has no effect on the direction of Matador Mining i.e., Matador Mining and Fremont Gold go up and down completely randomly.
Pair Corralation between Matador Mining and Fremont Gold
Assuming the 90 days horizon Matador Mining Limited is expected to generate 1.57 times more return on investment than Fremont Gold. However, Matador Mining is 1.57 times more volatile than Fremont Gold. It trades about 0.12 of its potential returns per unit of risk. Fremont Gold is currently generating about 0.04 per unit of risk. If you would invest 3.78 in Matador Mining Limited on September 1, 2024 and sell it today you would earn a total of 2.70 from holding Matador Mining Limited or generate 71.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 38.1% |
| Values | Daily Returns |
Matador Mining Limited vs. Fremont Gold
Performance |
| Timeline |
| Matador Mining |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Fremont Gold |
Matador Mining and Fremont Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Matador Mining and Fremont Gold
The main advantage of trading using opposite Matador Mining and Fremont Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Matador Mining position performs unexpectedly, Fremont 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 Fremont Gold will offset losses from the drop in Fremont Gold's long position.| Matador Mining vs. Rio2 Limited | Matador Mining vs. Aurion Resources | Matador Mining vs. Norsemont Mining | Matador Mining vs. Minaurum Gold |
| Fremont Gold vs. Aurion Resources | Fremont Gold vs. Rio2 Limited | Fremont Gold vs. Palamina Corp | Fremont Gold vs. BTU Metals Corp |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |