Correlation Between Ryder System and Gold Fields
Can any of the company-specific risk be diversified away by investing in both Ryder System and Gold Fields 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 Ryder System and Gold Fields into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ryder System and Gold Fields Limited, you can compare the effects of market volatilities on Ryder System and Gold Fields 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 Ryder System with a short position of Gold Fields. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ryder System and Gold Fields.
Diversification Opportunities for Ryder System and Gold Fields
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ryder and Gold is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Ryder System and Gold Fields Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Fields Limited and Ryder System 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 Ryder System are associated (or correlated) with Gold Fields. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Fields Limited has no effect on the direction of Ryder System i.e., Ryder System and Gold Fields go up and down completely randomly.
Pair Corralation between Ryder System and Gold Fields
Taking into account the 90-day investment horizon Ryder System is expected to generate 80.83 times less return on investment than Gold Fields. But when comparing it to its historical volatility, Ryder System is 26.95 times less risky than Gold Fields. It trades about 0.06 of its potential returns per unit of risk. Gold Fields Limited is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 225.00 in Gold Fields Limited on January 25, 2024 and sell it today you would earn a total of 1,427 from holding Gold Fields Limited or generate 634.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 85.63% |
| Values | Daily Returns |
Ryder System vs. Gold Fields Limited
Performance |
| Timeline |
| Ryder System |
| Gold Fields Limited |
Ryder System and Gold Fields Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ryder System and Gold Fields
The main advantage of trading using opposite Ryder System and Gold Fields positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ryder System position performs unexpectedly, Gold Fields 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 Fields will offset losses from the drop in Gold Fields' long position.| Ryder System vs. Hertz Global Hldgs | Ryder System vs. HE Equipment Services | Ryder System vs. United Rentals | Ryder System vs. Herc Holdings |
| Gold Fields vs. AngloGold Ashanti plc | Gold Fields vs. Harmony Gold Mining | Gold Fields vs. Eldorado Gold Corp | Gold Fields vs. Kinross 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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