Correlation Between Triple Flag and SolGold PLC
Can any of the company-specific risk be diversified away by investing in both Triple Flag and SolGold PLC 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 Triple Flag and SolGold PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Triple Flag Precious and SolGold PLC, you can compare the effects of market volatilities on Triple Flag and SolGold PLC 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 Triple Flag with a short position of SolGold PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triple Flag and SolGold PLC.
Diversification Opportunities for Triple Flag and SolGold PLC
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Triple and SolGold is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Triple Flag Precious and SolGold PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SolGold PLC and Triple Flag 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 Triple Flag Precious are associated (or correlated) with SolGold PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SolGold PLC has no effect on the direction of Triple Flag i.e., Triple Flag and SolGold PLC go up and down completely randomly.
Pair Corralation between Triple Flag and SolGold PLC
Assuming the 90 days trading horizon Triple Flag Precious is expected to generate 0.54 times more return on investment than SolGold PLC. However, Triple Flag Precious is 1.86 times less risky than SolGold PLC. It trades about 0.06 of its potential returns per unit of risk. SolGold PLC is currently generating about -0.1 per unit of risk. If you would invest 2,193 in Triple Flag Precious on August 29, 2024 and sell it today you would earn a total of 138.00 from holding Triple Flag Precious or generate 6.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Triple Flag Precious vs. SolGold PLC
Performance |
| Timeline |
| Triple Flag Precious |
| SolGold PLC |
Triple Flag and SolGold PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Triple Flag and SolGold PLC
The main advantage of trading using opposite Triple Flag and SolGold PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triple Flag position performs unexpectedly, SolGold PLC 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 SolGold PLC will offset losses from the drop in SolGold PLC's long position.| Triple Flag vs. UnitedHealth Group CDR | Triple Flag vs. Datable Technology Corp | Triple Flag vs. Reliq Health Technologies | Triple Flag vs. TGS Esports |
| SolGold PLC vs. Lundin Gold | SolGold PLC vs. Trilogy Metals | SolGold PLC vs. Solaris Resources | SolGold PLC vs. Tudor 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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