Correlation Between InMode and Gold Bull

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

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

Diversification Opportunities for InMode and Gold Bull

-0.63

Correlation Coefficient

InMode  Gold Bull

Excellent diversification

The 3 months correlation between InMode and Gold is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding InMode and Gold Bull Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Bull Resources and InMode 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 InMode are associated (or correlated) with Gold Bull. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Bull Resources has no effect on the direction of InMode i.e., InMode and Gold Bull go up and down completely randomly.

Pair Corralation between InMode and Gold Bull

Given the investment horizon of 90 days InMode is expected to under-perform the Gold Bull. But the stock apears to be less risky and, when comparing its historical volatility, InMode is 5.48 times less risky than Gold Bull. The stock trades about -0.03 of its potential returns per unit of risk. The Gold Bull Resources is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  25.00  in Gold Bull Resources on October 20, 2024 and sell it today you would earn a total of  7.00  from holding Gold Bull Resources or generate 28.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

InMode  vs.  Gold Bull Resources

InMode

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days InMode has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, InMode is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Gold Bull Resources

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Gold Bull Resources are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental indicators, Gold Bull reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with InMode and Gold Bull

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

The idea behind InMode and Gold Bull Resources 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.