Correlation Between MACOM Technology and GOLDGROUP MINING

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

By analyzing existing cross correlation between MACOM Technology Solutions and GOLDGROUP MINING INC, you can compare the effects of market volatilities on MACOM Technology and GOLDGROUP MINING 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 MACOM Technology with a short position of GOLDGROUP MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of MACOM Technology and GOLDGROUP MINING.

Diversification Opportunities for MACOM Technology and GOLDGROUP MINING

0.04

Correlation Coefficient

MACOM Technology  GOLDGROUP MINING

Significant diversification

The 3 months correlation between MACOM and GOLDGROUP is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding MACOM Technology Solutions and GOLDGROUP MINING INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GOLDGROUP MINING INC and MACOM Technology 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 MACOM Technology Solutions are associated (or correlated) with GOLDGROUP MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GOLDGROUP MINING INC has no effect on the direction of MACOM Technology i.e., MACOM Technology and GOLDGROUP MINING go up and down completely randomly.

Pair Corralation between MACOM Technology and GOLDGROUP MINING

Assuming the 90 days horizon MACOM Technology Solutions is expected to generate 0.6 times more return on investment than GOLDGROUP MINING. However, MACOM Technology Solutions is 1.67 times less risky than GOLDGROUP MINING. It trades about 0.18 of its potential returns per unit of risk. GOLDGROUP MINING INC is currently generating about 0.01 per unit of risk. If you would invest  9,250  in MACOM Technology Solutions on April 24, 2025 and sell it today you would earn a total of  2,350  from holding MACOM Technology Solutions or generate 25.41% return on investment over 90 days.

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

MACOM Technology Solutions  vs.  GOLDGROUP MINING INC

MACOM Technology Sol

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in MACOM Technology Solutions are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, MACOM Technology reported solid returns over the last few months and may actually be approaching a breakup point.

GOLDGROUP MINING INC

Risk-Adjusted Performance

Very Weak

Over the last 90 days GOLDGROUP MINING INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, GOLDGROUP MINING is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with MACOM Technology and GOLDGROUP MINING

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

The idea behind MACOM Technology Solutions and GOLDGROUP MINING INC 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.

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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.