Correlation Between GOLD ROAD and HOYA
Can any of the company-specific risk be diversified away by investing in both GOLD ROAD and HOYA 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 GOLD ROAD and HOYA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GOLD ROAD RES and HOYA Corporation, you can compare the effects of market volatilities on GOLD ROAD and HOYA 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 GOLD ROAD with a short position of HOYA. Check out your portfolio center. Please also check ongoing floating volatility patterns of GOLD ROAD and HOYA.
Diversification Opportunities for GOLD ROAD and HOYA
Good diversification
The 3 months correlation between GOLD and HOYA is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding GOLD ROAD RES and HOYA Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HOYA and GOLD ROAD 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 GOLD ROAD RES are associated (or correlated) with HOYA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HOYA has no effect on the direction of GOLD ROAD i.e., GOLD ROAD and HOYA go up and down completely randomly.
Pair Corralation between GOLD ROAD and HOYA
Assuming the 90 days trading horizon GOLD ROAD RES is expected to generate 1.24 times more return on investment than HOYA. However, GOLD ROAD is 1.24 times more volatile than HOYA Corporation. It trades about 0.17 of its potential returns per unit of risk. HOYA Corporation is currently generating about -0.12 per unit of risk. If you would invest 121.00 in GOLD ROAD RES on December 3, 2024 and sell it today you would earn a total of 27.00 from holding GOLD ROAD RES or generate 22.31% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.36% |
Values | Daily Returns |
GOLD ROAD RES vs. HOYA Corp.
Performance |
Timeline |
GOLD ROAD RES |
HOYA |
GOLD ROAD and HOYA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GOLD ROAD and HOYA
The main advantage of trading using opposite GOLD ROAD and HOYA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GOLD ROAD position performs unexpectedly, HOYA 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 HOYA will offset losses from the drop in HOYA's long position.GOLD ROAD vs. Ebro Foods SA | GOLD ROAD vs. US Foods Holding | GOLD ROAD vs. Spirent Communications plc | GOLD ROAD vs. FONIX MOBILE PLC |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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