Correlation Between Gold Bullion and Quantified Market

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

By analyzing existing cross correlation between The Gold Bullion and Quantified Market Leaders, you can compare the effects of market volatilities on Gold Bullion and Quantified Market 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 Gold Bullion with a short position of Quantified Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Bullion and Quantified Market.

Diversification Opportunities for Gold Bullion and Quantified Market

0.11

Correlation Coefficient

Gold Bullion  Quantified Market

Average diversification

The 3 months correlation between Gold and Quantified is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding The Gold Bullion and Quantified Market Leaders in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantified Market Leaders and Gold Bullion 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 The Gold Bullion are associated (or correlated) with Quantified Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantified Market Leaders has no effect on the direction of Gold Bullion i.e., Gold Bullion and Quantified Market go up and down completely randomly.

Pair Corralation between Gold Bullion and Quantified Market

Assuming the 90 days horizon The Gold Bullion is expected to under-perform the Quantified Market. In addition to that, Gold Bullion is 1.16 times more volatile than Quantified Market Leaders. It trades about -0.02 of its total potential returns per unit of risk. Quantified Market Leaders is currently generating about 0.24 per unit of volatility. If you would invest  930.00  in Quantified Market Leaders on May 4, 2025 and sell it today you would earn a total of  150.00  from holding Quantified Market Leaders or generate 16.13% return on investment over 90 days.

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

The Gold Bullion  vs.  Quantified Market Leaders

Gold Bullion

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Gold Bullion has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental indicators, Gold Bullion is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Quantified Market Leaders

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Quantified Market Leaders are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Quantified Market showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gold Bullion and Quantified Market

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

The idea behind The Gold Bullion and Quantified Market Leaders 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.