Correlation Between Shinhan Financial and Argonaut Gold
Can any of the company-specific risk be diversified away by investing in both Shinhan Financial and Argonaut 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 Shinhan Financial and Argonaut Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinhan Financial Group and Argonaut Gold, you can compare the effects of market volatilities on Shinhan Financial and Argonaut 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 Shinhan Financial with a short position of Argonaut Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Financial and Argonaut Gold.
Diversification Opportunities for Shinhan Financial and Argonaut Gold
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shinhan and Argonaut is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Financial Group and Argonaut Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argonaut Gold and Shinhan Financial 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 Shinhan Financial Group are associated (or correlated) with Argonaut Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argonaut Gold has no effect on the direction of Shinhan Financial i.e., Shinhan Financial and Argonaut Gold go up and down completely randomly.
Pair Corralation between Shinhan Financial and Argonaut Gold
Considering the 90-day investment horizon Shinhan Financial is expected to generate 1.82 times less return on investment than Argonaut Gold. But when comparing it to its historical volatility, Shinhan Financial Group is 2.59 times less risky than Argonaut Gold. It trades about 0.05 of its potential returns per unit of risk. Argonaut Gold is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 29.00 in Argonaut Gold on August 26, 2024 and sell it today you would earn a total of 8.00 from holding Argonaut Gold or generate 27.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 81.49% |
| Values | Daily Returns |
Shinhan Financial Group vs. Argonaut Gold
Performance |
| Timeline |
| Shinhan Financial |
| Argonaut Gold |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Shinhan Financial and Argonaut Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Financial and Argonaut Gold
The main advantage of trading using opposite Shinhan Financial and Argonaut Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Financial position performs unexpectedly, Argonaut 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 Argonaut Gold will offset losses from the drop in Argonaut Gold's long position.| Shinhan Financial vs. Banco Santander Brasil | Shinhan Financial vs. CrossFirst Bankshares | Shinhan Financial vs. Banco Bradesco SA | Shinhan Financial vs. CF Bankshares |
| Argonaut Gold vs. Aurion Resources | Argonaut Gold vs. Rio2 Limited | Argonaut Gold vs. Minera Alamos | Argonaut Gold vs. Liberty 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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