Correlation Between Continental Gold and BHP Group
Can any of the company-specific risk be diversified away by investing in both Continental Gold and BHP Group 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 Continental Gold and BHP Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Continental Gold and BHP Group Limited, you can compare the effects of market volatilities on Continental Gold and BHP Group 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 Continental Gold with a short position of BHP Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Continental Gold and BHP Group.
Diversification Opportunities for Continental Gold and BHP Group
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Continental and BHP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Continental Gold and BHP Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BHP Group Limited and Continental 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 Continental Gold are associated (or correlated) with BHP Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BHP Group Limited has no effect on the direction of Continental Gold i.e., Continental Gold and BHP Group go up and down completely randomly.
Pair Corralation between Continental Gold and BHP Group
If you would invest 2,358 in BHP Group Limited on January 26, 2024 and sell it today you would earn a total of 490.00 from holding BHP Group Limited or generate 20.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Continental Gold vs. BHP Group Limited
Performance |
| Timeline |
| Continental Gold |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| BHP Group Limited |
Continental Gold and BHP Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Continental Gold and BHP Group
The main advantage of trading using opposite Continental Gold and BHP Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Continental Gold position performs unexpectedly, BHP Group 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 BHP Group will offset losses from the drop in BHP Group's long position.| Continental Gold vs. Carters | Continental Gold vs. Levi Strauss Co | Continental Gold vs. MYT Netherlands Parent | Continental Gold vs. Getty Realty |
| BHP Group vs. Churchill Resources | BHP Group vs. Western Troy Capital | BHP Group vs. Beyond Minerals | BHP Group vs. Altius Minerals |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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