Correlation Between Triumph Gold and Fremont Gold

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

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

Diversification Opportunities for Triumph Gold and Fremont Gold

-0.17

Correlation Coefficient

Triumph Gold  Fremont Gold

Good diversification

The 3 months correlation between Triumph and Fremont is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Triumph Gold Corp and Fremont Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fremont Gold and Triumph 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 Triumph Gold Corp are associated (or correlated) with Fremont Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fremont Gold has no effect on the direction of Triumph Gold i.e., Triumph Gold and Fremont Gold go up and down completely randomly.

Pair Corralation between Triumph Gold and Fremont Gold

Assuming the 90 days horizon Triumph Gold Corp is expected to generate 1.12 times more return on investment than Fremont Gold. However, Triumph Gold is 1.12 times more volatile than Fremont Gold. It trades about 0.04 of its potential returns per unit of risk. Fremont Gold is currently generating about 0.03 per unit of risk. If you would invest  23.00  in Triumph Gold Corp on October 10, 2024 and sell it today you would earn a total of  0.00  from holding Triumph Gold Corp 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

Triumph Gold Corp  vs.  Fremont Gold

Triumph Gold Corp

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Triumph Gold Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Triumph Gold showed solid returns over the last few months and may actually be approaching a breakup point.

Fremont Gold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fremont Gold has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Triumph Gold and Fremont Gold

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

The idea behind Triumph Gold Corp and Fremont 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.