Correlation Between Unigold and Euro Sun

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Can any of the company-specific risk be diversified away by investing in both Unigold and Euro Sun 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 Unigold and Euro Sun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unigold and Euro Sun Mining, you can compare the effects of market volatilities on Unigold and Euro Sun 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 Unigold with a short position of Euro Sun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unigold and Euro Sun.

Diversification Opportunities for Unigold and Euro Sun

0.08
  Correlation Coefficient

Significant diversification

The 3 months correlation between Unigold and Euro is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Unigold and Euro Sun Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Euro Sun Mining and Unigold 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 Unigold are associated (or correlated) with Euro Sun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Euro Sun Mining has no effect on the direction of Unigold i.e., Unigold and Euro Sun go up and down completely randomly.

Pair Corralation between Unigold and Euro Sun

Assuming the 90 days horizon Unigold is expected to generate 1.33 times more return on investment than Euro Sun. However, Unigold is 1.33 times more volatile than Euro Sun Mining. It trades about 0.11 of its potential returns per unit of risk. Euro Sun Mining is currently generating about 0.12 per unit of risk. If you would invest  9.00  in Unigold on September 10, 2025 and sell it today you would earn a total of  4.00  from holding Unigold or generate 44.44% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Unigold  vs.  Euro Sun Mining

 Performance 
       Timeline  
Unigold 

Risk-Adjusted Performance

Fair

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Unigold are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain forward indicators, Unigold reported solid returns over the last few months and may actually be approaching a breakup point.
Euro Sun Mining 

Risk-Adjusted Performance

Fair

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Euro Sun Mining are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Euro Sun reported solid returns over the last few months and may actually be approaching a breakup point.

Unigold and Euro Sun Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Unigold and Euro Sun

The main advantage of trading using opposite Unigold and Euro Sun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unigold position performs unexpectedly, Euro Sun 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 Euro Sun will offset losses from the drop in Euro Sun's long position.
The idea behind Unigold and Euro Sun Mining 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.

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