Correlation Between Q Gold and Centerra Gold
Can any of the company-specific risk be diversified away by investing in both Q Gold and Centerra 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 Q Gold and Centerra Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Q Gold Resources and Centerra Gold, you can compare the effects of market volatilities on Q Gold and Centerra 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 Q Gold with a short position of Centerra Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Q Gold and Centerra Gold.
Diversification Opportunities for Q Gold and Centerra Gold
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between QGR and Centerra is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Q Gold Resources and Centerra Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centerra Gold and Q Gold 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 Q Gold Resources are associated (or correlated) with Centerra Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centerra Gold has no effect on the direction of Q Gold i.e., Q Gold and Centerra Gold go up and down completely randomly.
Pair Corralation between Q Gold and Centerra Gold
Assuming the 90 days horizon Q Gold Resources is expected to generate 3.92 times more return on investment than Centerra Gold. However, Q Gold is 3.92 times more volatile than Centerra Gold. It trades about 0.01 of its potential returns per unit of risk. Centerra Gold is currently generating about -0.17 per unit of risk. If you would invest 19.00 in Q Gold Resources on September 26, 2024 and sell it today you would lose (3.00) from holding Q Gold Resources or give up 15.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Q Gold Resources vs. Centerra Gold
Performance |
| Timeline |
| Q Gold Resources |
| Centerra Gold |
Q Gold and Centerra Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Q Gold and Centerra Gold
The main advantage of trading using opposite Q Gold and Centerra Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Q Gold position performs unexpectedly, Centerra 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 Centerra Gold will offset losses from the drop in Centerra Gold's long position.| Q Gold vs. Precipitate Gold Corp | Q Gold vs. Chakana Copper Corp | Q Gold vs. ROKMASTER Resources Corp | Q Gold vs. Rugby Mining Limited |
| Centerra Gold vs. Wildsky Resources | Centerra Gold vs. Q Gold Resources | Centerra Gold vs. Plato Gold Corp | Centerra Gold vs. MAS Gold 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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