Correlation Between Quantum Foods and Gold Fields
Can any of the company-specific risk be diversified away by investing in both Quantum Foods and Gold Fields 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 Quantum Foods and Gold Fields into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quantum Foods Holdings and Gold Fields, you can compare the effects of market volatilities on Quantum Foods and Gold Fields 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 Quantum Foods with a short position of Gold Fields. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quantum Foods and Gold Fields.
Diversification Opportunities for Quantum Foods and Gold Fields
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Quantum and Gold is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Quantum Foods Holdings and Gold Fields in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Fields and Quantum Foods 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 Quantum Foods Holdings are associated (or correlated) with Gold Fields. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Fields has no effect on the direction of Quantum Foods i.e., Quantum Foods and Gold Fields go up and down completely randomly.
Pair Corralation between Quantum Foods and Gold Fields
Assuming the 90 days trading horizon Quantum Foods Holdings is expected to generate 2.72 times more return on investment than Gold Fields. However, Quantum Foods is 2.72 times more volatile than Gold Fields. It trades about 0.06 of its potential returns per unit of risk. Gold Fields is currently generating about 0.0 per unit of risk. If you would invest 45,000 in Quantum Foods Holdings on August 31, 2024 and sell it today you would earn a total of 40,000 from holding Quantum Foods Holdings or generate 88.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Quantum Foods Holdings vs. Gold Fields
Performance |
| Timeline |
| Quantum Foods Holdings |
| Gold Fields |
Quantum Foods and Gold Fields Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quantum Foods and Gold Fields
The main advantage of trading using opposite Quantum Foods and Gold Fields positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quantum Foods position performs unexpectedly, Gold Fields 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 Fields will offset losses from the drop in Gold Fields' long position.| Quantum Foods vs. Centaur Bci Balanced | Quantum Foods vs. Sabvest Capital | Quantum Foods vs. AfricaRhodium ETF | Quantum Foods vs. Indexco Limited |
| Gold Fields vs. Sibanye Stillwater | Gold Fields vs. Harmony Gold Mining | Gold Fields vs. Pan African Resources |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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