Correlation Between Freegold Ventures and America Movil

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

By analyzing existing cross correlation between Freegold Ventures Limited and Amex Exploration, you can compare the effects of market volatilities on Freegold Ventures and America Movil 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 Freegold Ventures with a short position of America Movil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Freegold Ventures and America Movil.

Diversification Opportunities for Freegold Ventures and America Movil

0.71

Correlation Coefficient

Freegold Ventures  America Movil

Poor diversification

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

Pair Corralation between Freegold Ventures and America Movil

Assuming the 90 days trading horizon Freegold Ventures is expected to generate 3.21 times less return on investment than America Movil. But when comparing it to its historical volatility, Freegold Ventures Limited is 1.17 times less risky than America Movil. It trades about 0.07 of its potential returns per unit of risk. Amex Exploration is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  106.00  in Amex Exploration on April 20, 2025 and sell it today you would earn a total of  72.00  from holding Amex Exploration or generate 67.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

Freegold Ventures Limited  vs.  Amex Exploration

Freegold Ventures

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Freegold Ventures Limited are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal essential indicators, Freegold Ventures displayed solid returns over the last few months and may actually be approaching a breakup point.

Amex Exploration

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Amex Exploration are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, America Movil showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Freegold Ventures and America Movil

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

The idea behind Freegold Ventures Limited and Amex Exploration 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.