Correlation Between CI Galaxy and Purpose Gold

Can any of the company-specific risk be diversified away by investing in both CI Galaxy and Purpose 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 CI Galaxy and Purpose Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CI Galaxy Blockchain and Purpose Gold Bullion, you can compare the effects of market volatilities on CI Galaxy and Purpose 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 CI Galaxy with a short position of Purpose Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Galaxy and Purpose Gold.

Diversification Opportunities for CI Galaxy and Purpose Gold

-0.78

Correlation Coefficient

CI Galaxy  Purpose Gold

Pay attention - limited upside

The 3 months correlation between CBCX and Purpose is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding CI Galaxy Blockchain and Purpose Gold Bullion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Purpose Gold Bullion and CI Galaxy 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 CI Galaxy Blockchain are associated (or correlated) with Purpose Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Purpose Gold Bullion has no effect on the direction of CI Galaxy i.e., CI Galaxy and Purpose Gold go up and down completely randomly.

Pair Corralation between CI Galaxy and Purpose Gold

Assuming the 90 days trading horizon CI Galaxy Blockchain is expected to under-perform the Purpose Gold. In addition to that, CI Galaxy is 5.31 times more volatile than Purpose Gold Bullion. It trades about -0.11 of its total potential returns per unit of risk. Purpose Gold Bullion is currently generating about 0.3 per unit of volatility. If you would invest  4,458  in Purpose Gold Bullion on December 30, 2024 and sell it today you would earn a total of  783.00  from holding Purpose Gold Bullion or generate 17.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

CI Galaxy Blockchain  vs.  Purpose Gold Bullion

CI Galaxy Blockchain

Risk-Adjusted Performance

Very Weak

Over the last 90 days CI Galaxy Blockchain has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Etf's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the ETF investors.

Purpose Gold Bullion

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Purpose Gold Bullion are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak essential indicators, Purpose Gold sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CI Galaxy and Purpose Gold

The main advantage of trading using opposite CI Galaxy and Purpose Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Galaxy position performs unexpectedly, Purpose 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 Purpose Gold will offset losses from the drop in Purpose Gold's long position.

The idea behind CI Galaxy Blockchain and Purpose Gold Bullion pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.