Correlation Between Peel Mining and Gold Road
Can any of the company-specific risk be diversified away by investing in both Peel Mining and Gold Road 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 Peel Mining and Gold Road into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peel Mining and Gold Road Resources, you can compare the effects of market volatilities on Peel Mining and Gold Road 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 Peel Mining with a short position of Gold Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peel Mining and Gold Road.
Diversification Opportunities for Peel Mining and Gold Road
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Peel and Gold is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Peel Mining and Gold Road Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Road Resources and Peel 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 Peel Mining are associated (or correlated) with Gold Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Road Resources has no effect on the direction of Peel Mining i.e., Peel Mining and Gold Road go up and down completely randomly.
Pair Corralation between Peel Mining and Gold Road
Assuming the 90 days trading horizon Peel Mining is expected to under-perform the Gold Road. In addition to that, Peel Mining is 1.52 times more volatile than Gold Road Resources. It trades about -0.23 of its total potential returns per unit of risk. Gold Road Resources is currently generating about 0.1 per unit of volatility. If you would invest 211.00 in Gold Road Resources on October 14, 2024 and sell it today you would earn a total of 5.00 from holding Gold Road Resources or generate 2.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peel Mining vs. Gold Road Resources
Performance |
| Timeline |
| Peel Mining |
| Gold Road Resources |
Peel Mining and Gold Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peel Mining and Gold Road
The main advantage of trading using opposite Peel Mining and Gold Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peel Mining position performs unexpectedly, Gold Road 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 Road will offset losses from the drop in Gold Road's long position.| Peel Mining vs. The Environmental Group | Peel Mining vs. Tombador Iron | Peel Mining vs. Homeco Daily Needs | Peel Mining vs. Champion Iron |
| Gold Road vs. Treasury Wine Estates | Gold Road vs. DMC Mining | Gold Road vs. Peel Mining | Gold Road vs. Hansen Technologies |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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