Correlation Between Tidal Trust and Dundee Precious

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

By analyzing existing cross correlation between Tidal Trust II and Dundee Precious Metals, you can compare the effects of market volatilities on Tidal Trust and Dundee Precious 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 Tidal Trust with a short position of Dundee Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tidal Trust and Dundee Precious.

Diversification Opportunities for Tidal Trust and Dundee Precious

0.89

Correlation Coefficient

Tidal Trust  Dundee Precious

Very poor diversification

The 3 months correlation between Tidal and Dundee is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Tidal Trust II and Dundee Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dundee Precious Metals and Tidal Trust 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 Tidal Trust II are associated (or correlated) with Dundee Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dundee Precious Metals has no effect on the direction of Tidal Trust i.e., Tidal Trust and Dundee Precious go up and down completely randomly.

Pair Corralation between Tidal Trust and Dundee Precious

Given the investment horizon of 90 days Tidal Trust is expected to generate 1.02 times less return on investment than Dundee Precious. But when comparing it to its historical volatility, Tidal Trust II is 1.95 times less risky than Dundee Precious. It trades about 0.29 of its potential returns per unit of risk. Dundee Precious Metals is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  1,323  in Dundee Precious Metals on May 4, 2025 and sell it today you would earn a total of  302.00  from holding Dundee Precious Metals or generate 22.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.41%
Values	Daily Returns

Tidal Trust II  vs.  Dundee Precious Metals

Tidal Trust II

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Tidal Trust II are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Tidal Trust showed solid returns over the last few months and may actually be approaching a breakup point.

Dundee Precious Metals

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dundee Precious Metals are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile essential indicators, Dundee Precious reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Tidal Trust and Dundee Precious

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

The idea behind Tidal Trust II and Dundee Precious Metals 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.