Correlation Between Caldas Gold and Gentex

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

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

Diversification Opportunities for Caldas Gold and Gentex

0.0

Correlation Coefficient

Caldas Gold  Gentex

Pay attention - limited upside

The 3 months correlation between Caldas and Gentex is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Caldas Gold and Gentex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gentex and Caldas Gold 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 Caldas Gold are associated (or correlated) with Gentex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gentex has no effect on the direction of Caldas Gold i.e., Caldas Gold and Gentex go up and down completely randomly.

Pair Corralation between Caldas Gold and Gentex

If you would invest (100.00) in Caldas Gold on December 20, 2024 and sell it today you would earn a total of  100.00  from holding Caldas Gold or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Caldas Gold  vs.  Gentex

Caldas Gold

Risk-Adjusted Performance

Very Weak

Over the last 90 days Caldas Gold has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Caldas Gold is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Gentex

Risk-Adjusted Performance

Very Weak

Over the last 90 days Gentex has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Caldas Gold and Gentex

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

The idea behind Caldas Gold and Gentex 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.

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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.