Correlation Between Gold Reserve and Almaden Minerals
Can any of the company-specific risk be diversified away by investing in both Gold Reserve and Almaden Minerals 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 Reserve and Almaden Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gold Reserve and Almaden Minerals, you can compare the effects of market volatilities on Gold Reserve and Almaden Minerals 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 Reserve with a short position of Almaden Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Reserve and Almaden Minerals.
Diversification Opportunities for Gold Reserve and Almaden Minerals
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gold and Almaden is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Gold Reserve and Almaden Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Almaden Minerals and Gold Reserve 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 Reserve are associated (or correlated) with Almaden Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Almaden Minerals has no effect on the direction of Gold Reserve i.e., Gold Reserve and Almaden Minerals go up and down completely randomly.
Pair Corralation between Gold Reserve and Almaden Minerals
Assuming the 90 days horizon Gold Reserve is expected to generate 0.05 times more return on investment than Almaden Minerals. However, Gold Reserve is 19.62 times less risky than Almaden Minerals. It trades about -0.04 of its potential returns per unit of risk. Almaden Minerals is currently generating about -0.26 per unit of risk. If you would invest 297.00 in Gold Reserve on January 20, 2024 and sell it today you would lose (4.00) from holding Gold Reserve or give up 1.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 61.9% |
| Values | Daily Returns |
Gold Reserve vs. Almaden Minerals
Performance |
| Timeline |
| Gold Reserve |
| Almaden Minerals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Gold Reserve and Almaden Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Reserve and Almaden Minerals
The main advantage of trading using opposite Gold Reserve and Almaden Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Reserve position performs unexpectedly, Almaden Minerals 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 Almaden Minerals will offset losses from the drop in Almaden Minerals' long position.| Gold Reserve vs. Alumina Limited | Gold Reserve vs. HUMANA INC | Gold Reserve vs. Aquagold International | Gold Reserve vs. Spring Valley Acquisition |
| Almaden Minerals vs. Paramount Gold Nevada | Almaden Minerals vs. Liberty Gold Corp | Almaden Minerals vs. International Tower Hill | Almaden Minerals vs. Allegiant Gold |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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