Correlation Between George Weston and Soma Gold
Can any of the company-specific risk be diversified away by investing in both George Weston and Soma 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 George Weston and Soma Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between George Weston Limited and Soma Gold Corp, you can compare the effects of market volatilities on George Weston and Soma 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 George Weston with a short position of Soma Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of George Weston and Soma Gold.
Diversification Opportunities for George Weston and Soma Gold
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between George and Soma is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding George Weston Limited and Soma Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soma Gold Corp and George Weston 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 George Weston Limited are associated (or correlated) with Soma Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soma Gold Corp has no effect on the direction of George Weston i.e., George Weston and Soma Gold go up and down completely randomly.
Pair Corralation between George Weston and Soma Gold
Assuming the 90 days horizon George Weston Limited is expected to generate 0.23 times more return on investment than Soma Gold. However, George Weston Limited is 4.26 times less risky than Soma Gold. It trades about 0.2 of its potential returns per unit of risk. Soma Gold Corp is currently generating about -0.15 per unit of risk. If you would invest 21,829 in George Weston Limited on September 21, 2024 and sell it today you would earn a total of 875.00 from holding George Weston Limited or generate 4.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
George Weston Limited vs. Soma Gold Corp
Performance |
| Timeline |
| George Weston Limited |
| Soma Gold Corp |
George Weston and Soma Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with George Weston and Soma Gold
The main advantage of trading using opposite George Weston and Soma Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if George Weston position performs unexpectedly, Soma 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 Soma Gold will offset losses from the drop in Soma Gold's long position.| George Weston vs. Covalon Technologies | George Weston vs. Sirona Biochem Corp | George Weston vs. Medicure | George Weston vs. Arch Biopartners |
| Soma Gold vs. Revival Gold | Soma Gold vs. Outcrop Gold Corp | Soma Gold vs. Scottie Resources Corp | Soma Gold vs. Royal Road Minerals |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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