Correlation Between NYSE Composite and Golden Goliath
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Golden Goliath 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 Goliath 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 Goliath Resources, you can compare the effects of market volatilities on NYSE Composite and Golden Goliath 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 Goliath. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Golden Goliath.
Diversification Opportunities for NYSE Composite and Golden Goliath
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and Golden is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Golden Goliath Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Goliath Resources 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 Goliath. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Goliath Resources has no effect on the direction of NYSE Composite i.e., NYSE Composite and Golden Goliath go up and down completely randomly.
Pair Corralation between NYSE Composite and Golden Goliath
Assuming the 90 days trading horizon NYSE Composite is expected to generate 26.35 times less return on investment than Golden Goliath. But when comparing it to its historical volatility, NYSE Composite is 86.84 times less risky than Golden Goliath. It trades about 0.42 of its potential returns per unit of risk. Golden Goliath Resources is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 8.50 in Golden Goliath Resources on September 1, 2024 and sell it today you would lose (2.40) from holding Golden Goliath Resources or give up 28.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Golden Goliath Resources
Performance |
| Timeline |
NYSE Composite and Golden Goliath Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Golden Goliath Resources
Pair trading matchups for Golden Goliath
Pair Trading with NYSE Composite and Golden Goliath
The main advantage of trading using opposite NYSE Composite and Golden Goliath positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Golden Goliath 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 Goliath will offset losses from the drop in Golden Goliath's long position.| NYSE Composite vs. Acumen Pharmaceuticals | NYSE Composite vs. Mind Medicine | NYSE Composite vs. NL Industries | NYSE Composite vs. Ecovyst |
| Golden Goliath vs. Silver Spruce Resources | Golden Goliath vs. Portofino Resources | Golden Goliath vs. Freegold Ventures Limited | Golden Goliath vs. Bravada Gold |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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