Correlation Between GoldMining and Canadian General

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

By analyzing existing cross correlation between GoldMining and Canadian General Investments, you can compare the effects of market volatilities on GoldMining and Canadian General 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 GoldMining with a short position of Canadian General. Check out your portfolio center. Please also check ongoing floating volatility patterns of GoldMining and Canadian General.

Diversification Opportunities for GoldMining and Canadian General

-0.71

Correlation Coefficient

GoldMining  Canadian General

Pay attention - limited upside

The 3 months correlation between GoldMining and Canadian is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding GoldMining and Canadian General Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian General Inv and GoldMining 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 GoldMining are associated (or correlated) with Canadian General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian General Inv has no effect on the direction of GoldMining i.e., GoldMining and Canadian General go up and down completely randomly.

Pair Corralation between GoldMining and Canadian General

Assuming the 90 days trading horizon GoldMining is expected to under-perform the Canadian General. In addition to that, GoldMining is 2.5 times more volatile than Canadian General Investments. It trades about -0.01 of its total potential returns per unit of risk. Canadian General Investments is currently generating about 0.3 per unit of volatility. If you would invest  177,749  in Canadian General Investments on April 24, 2025 and sell it today you would earn a total of  41,751  from holding Canadian General Investments or generate 23.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	53.23%
Values	Daily Returns

GoldMining  vs.  Canadian General Investments

GoldMining

Risk-Adjusted Performance

Very Weak

Over the last 90 days GoldMining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, GoldMining is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Canadian General Inv

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Canadian General Investments are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Canadian General exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GoldMining and Canadian General

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

The idea behind GoldMining and Canadian General Investments 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.