Correlation Between ZINC MEDIA and Gold Road

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

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

Diversification Opportunities for ZINC MEDIA and Gold Road

-0.79

Correlation Coefficient

ZINC MEDIA  Gold Road

Pay attention - limited upside

The 3 months correlation between ZINC and Gold is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding ZINC MEDIA GR and Gold Road Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Road Resources and ZINC MEDIA 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 ZINC MEDIA GR are associated (or correlated) with Gold Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Road Resources has no effect on the direction of ZINC MEDIA i.e., ZINC MEDIA and Gold Road go up and down completely randomly.

Pair Corralation between ZINC MEDIA and Gold Road

Assuming the 90 days trading horizon ZINC MEDIA GR is expected to under-perform the Gold Road. In addition to that, ZINC MEDIA is 1.09 times more volatile than Gold Road Resources. It trades about -0.13 of its total potential returns per unit of risk. Gold Road Resources is currently generating about 0.16 per unit of volatility. If you would invest  99.00  in Gold Road Resources on September 20, 2024 and sell it today you would earn a total of  25.00  from holding Gold Road Resources or generate 25.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

ZINC MEDIA GR  vs.  Gold Road Resources

ZINC MEDIA GR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ZINC MEDIA GR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Gold Road Resources

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Gold Road Resources are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Gold Road reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ZINC MEDIA and Gold Road

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

The idea behind ZINC MEDIA GR and Gold Road 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.

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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.