Correlation Between IShares Fundamental and Minaurum Gold

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

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

Diversification Opportunities for IShares Fundamental and Minaurum Gold

-0.21

Correlation Coefficient

IShares Fundamental  Minaurum Gold

Very good diversification

The 3 months correlation between IShares and Minaurum is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding iShares Fundamental Hedged and Minaurum Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minaurum Gold and IShares Fundamental 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 iShares Fundamental Hedged are associated (or correlated) with Minaurum Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minaurum Gold has no effect on the direction of IShares Fundamental i.e., IShares Fundamental and Minaurum Gold go up and down completely randomly.

Pair Corralation between IShares Fundamental and Minaurum Gold

Assuming the 90 days trading horizon IShares Fundamental is expected to generate 3.55 times less return on investment than Minaurum Gold. But when comparing it to its historical volatility, iShares Fundamental Hedged is 9.05 times less risky than Minaurum Gold. It trades about 0.08 of its potential returns per unit of risk. Minaurum Gold is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  21.00  in Minaurum Gold on October 7, 2024 and sell it today you would earn a total of  0.00  from holding Minaurum Gold or generate 0.0% return on investment over 90 days.

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

iShares Fundamental Hedged  vs.  Minaurum Gold

iShares Fundamental

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Fundamental Hedged are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, IShares Fundamental is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Minaurum Gold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Minaurum Gold has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with IShares Fundamental and Minaurum Gold

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

The idea behind iShares Fundamental Hedged and Minaurum Gold 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.