Correlation Between NYSE Composite and Golden Minerals
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Golden Minerals 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 NYSE Composite and Golden Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Golden Minerals, you can compare the effects of market volatilities on NYSE Composite and Golden Minerals 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 NYSE Composite with a short position of Golden Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Golden Minerals.
Diversification Opportunities for NYSE Composite and Golden Minerals
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between NYSE and Golden is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Golden Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Minerals and NYSE Composite 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 NYSE Composite are associated (or correlated) with Golden Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Minerals has no effect on the direction of NYSE Composite i.e., NYSE Composite and Golden Minerals go up and down completely randomly.
Pair Corralation between NYSE Composite and Golden Minerals
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.09 times more return on investment than Golden Minerals. However, NYSE Composite is 10.74 times less risky than Golden Minerals. It trades about 0.08 of its potential returns per unit of risk. Golden Minerals is currently generating about -0.05 per unit of risk. If you would invest 1,589,536 in NYSE Composite on August 27, 2024 and sell it today you would earn a total of 422,809 from holding NYSE Composite or generate 26.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Golden Minerals
Performance |
| Timeline |
NYSE Composite and Golden Minerals Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Golden Minerals
Pair trading matchups for Golden Minerals
Pair Trading with NYSE Composite and Golden Minerals
The main advantage of trading using opposite NYSE Composite and Golden Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Golden Minerals 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 Golden Minerals will offset losses from the drop in Golden Minerals' long position.| NYSE Composite vs. Hooker Furniture | NYSE Composite vs. Hudson Pacific Properties | NYSE Composite vs. Canlan Ice Sports | NYSE Composite vs. Boston Properties |
| Golden Minerals vs. Summa Silver Corp | Golden Minerals vs. GoGold Resources | Golden Minerals vs. Scottie Resources Corp | Golden Minerals vs. Brixton Metals |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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