Correlation Between Methanex and Centerra Gold
Can any of the company-specific risk be diversified away by investing in both Methanex and Centerra 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 Methanex and Centerra Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Methanex and Centerra Gold, you can compare the effects of market volatilities on Methanex and Centerra 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 Methanex with a short position of Centerra Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Methanex and Centerra Gold.
Diversification Opportunities for Methanex and Centerra Gold
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Methanex and Centerra is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Methanex and Centerra Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centerra Gold and Methanex 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 Methanex are associated (or correlated) with Centerra Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centerra Gold has no effect on the direction of Methanex i.e., Methanex and Centerra Gold go up and down completely randomly.
Pair Corralation between Methanex and Centerra Gold
Given the investment horizon of 90 days Methanex is expected to generate 19.42 times less return on investment than Centerra Gold. In addition to that, Methanex is 1.04 times more volatile than Centerra Gold. It trades about 0.01 of its total potential returns per unit of risk. Centerra Gold is currently generating about 0.24 per unit of volatility. If you would invest 764.00 in Centerra Gold on August 25, 2025 and sell it today you would earn a total of 396.00 from holding Centerra Gold or generate 51.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Methanex vs. Centerra Gold
Performance |
| Timeline |
| Methanex |
| Centerra Gold |
Methanex and Centerra Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Methanex and Centerra Gold
The main advantage of trading using opposite Methanex and Centerra Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Methanex position performs unexpectedly, Centerra 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 Centerra Gold will offset losses from the drop in Centerra Gold's long position.| Methanex vs. WD 40 Company | Methanex vs. Boise Cascad Llc | Methanex vs. Fortuna Silver Mines | Methanex vs. Hawkins |
| Centerra Gold vs. Seabridge Gold | Centerra Gold vs. DRDGOLD Limited ADR | Centerra Gold vs. Boise Cascad Llc | Centerra Gold vs. Fortuna Silver Mines |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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