Correlation Between Cisco Systems and GOLDGROUP MINING

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

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

Diversification Opportunities for Cisco Systems and GOLDGROUP MINING

-0.02

Correlation Coefficient

Cisco Systems  GOLDGROUP MINING

Good diversification

The 3 months correlation between Cisco and GOLDGROUP is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems 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 Cisco Systems 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 Cisco Systems 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 Cisco Systems i.e., Cisco Systems and GOLDGROUP MINING go up and down completely randomly.

Pair Corralation between Cisco Systems and GOLDGROUP MINING

Assuming the 90 days horizon Cisco Systems is expected to generate 0.39 times more return on investment than GOLDGROUP MINING. However, Cisco Systems is 2.55 times less risky than GOLDGROUP MINING. It trades about 0.12 of its potential returns per unit of risk. GOLDGROUP MINING INC is currently generating about -0.22 per unit of risk. If you would invest  5,620  in Cisco Systems on July 17, 2025 and sell it today you would earn a total of  186.00  from holding Cisco Systems or generate 3.31% return on investment over 90 days.

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

Cisco Systems  vs.  GOLDGROUP MINING INC

Cisco Systems

Risk-Adjusted Performance

Weak

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

GOLDGROUP MINING INC

Risk-Adjusted Performance

Weakest

Over the last 90 days GOLDGROUP MINING INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Cisco Systems and GOLDGROUP MINING

The main advantage of trading using opposite Cisco Systems and GOLDGROUP MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cisco Systems 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 Cisco Systems 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.