Correlation Between Signal Gold and Automotive Finco
Can any of the company-specific risk be diversified away by investing in both Signal Gold and Automotive Finco 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 Signal Gold and Automotive Finco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Signal Gold and Automotive Finco Corp, you can compare the effects of market volatilities on Signal Gold and Automotive Finco 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 Signal Gold with a short position of Automotive Finco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Signal Gold and Automotive Finco.
Diversification Opportunities for Signal Gold and Automotive Finco
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Signal and Automotive is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Signal Gold and Automotive Finco Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Automotive Finco Corp and Signal 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 Signal Gold are associated (or correlated) with Automotive Finco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Automotive Finco Corp has no effect on the direction of Signal Gold i.e., Signal Gold and Automotive Finco go up and down completely randomly.
Pair Corralation between Signal Gold and Automotive Finco
Assuming the 90 days trading horizon Signal Gold is expected to under-perform the Automotive Finco. In addition to that, Signal Gold is 1.06 times more volatile than Automotive Finco Corp. It trades about -0.02 of its total potential returns per unit of risk. Automotive Finco Corp is currently generating about 0.07 per unit of volatility. If you would invest 50.00 in Automotive Finco Corp on September 1, 2024 and sell it today you would earn a total of 39.00 from holding Automotive Finco Corp or generate 78.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Signal Gold vs. Automotive Finco Corp
Performance |
| Timeline |
| Signal Gold |
| Automotive Finco Corp |
Signal Gold and Automotive Finco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Signal Gold and Automotive Finco
The main advantage of trading using opposite Signal Gold and Automotive Finco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Signal Gold position performs unexpectedly, Automotive Finco 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 Automotive Finco will offset losses from the drop in Automotive Finco's long position.| Signal Gold vs. Montage Gold Corp | Signal Gold vs. Cerrado Gold Corp | Signal Gold vs. Steppe Gold | Signal Gold vs. Maritime Resources Corp |
| Automotive Finco vs. Royal Bank of | Automotive Finco vs. Royal Bank of | Automotive Finco vs. Royal Bank of | Automotive Finco vs. Toronto Dominion Bank Pref |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |