Correlation Between Firsthand Technology and Gold
Can any of the company-specific risk be diversified away by investing in both Firsthand Technology and 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 Firsthand Technology and Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Firsthand Technology Opportunities and Gold And Precious, you can compare the effects of market volatilities on Firsthand Technology and 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 Firsthand Technology with a short position of Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firsthand Technology and Gold.
Diversification Opportunities for Firsthand Technology and Gold
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between FIRSTHAND and Gold is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Firsthand Technology Opportuni and Gold And Precious in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold And Precious and Firsthand Technology 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 Firsthand Technology Opportunities are associated (or correlated) with Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold And Precious has no effect on the direction of Firsthand Technology i.e., Firsthand Technology and Gold go up and down completely randomly.
Pair Corralation between Firsthand Technology and Gold
Assuming the 90 days horizon Firsthand Technology Opportunities is expected to under-perform the Gold. In addition to that, Firsthand Technology is 1.05 times more volatile than Gold And Precious. It trades about -0.02 of its total potential returns per unit of risk. Gold And Precious is currently generating about 0.05 per unit of volatility. If you would invest 990.00 in Gold And Precious on August 31, 2024 and sell it today you would earn a total of 272.00 from holding Gold And Precious or generate 27.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
Firsthand Technology Opportuni vs. Gold And Precious
Performance |
| Timeline |
| Firsthand Technology |
| Gold And Precious |
Firsthand Technology and Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Firsthand Technology and Gold
The main advantage of trading using opposite Firsthand Technology and Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firsthand Technology position performs unexpectedly, 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 Gold will offset losses from the drop in Gold's long position.| Firsthand Technology vs. Berkshire Focus | Firsthand Technology vs. Red Oak Technology | Firsthand Technology vs. Jacob Internet Fund | Firsthand Technology vs. Kinetics Internet Fund |
| Gold vs. Us Small Cap | Gold vs. Small Pany Growth | Gold vs. Jpmorgan Small Cap | Gold vs. Kinetics Small Cap |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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