Correlation Between American Creek and Magellan Gold
Can any of the company-specific risk be diversified away by investing in both American Creek and Magellan Gold 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 American Creek and Magellan Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Creek Resources and Magellan Gold Corp, you can compare the effects of market volatilities on American Creek and Magellan Gold 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 American Creek with a short position of Magellan Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Creek and Magellan Gold.
Diversification Opportunities for American Creek and Magellan Gold
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between American and Magellan is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding American Creek Resources and Magellan Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magellan Gold Corp and American Creek 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 American Creek Resources are associated (or correlated) with Magellan Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magellan Gold Corp has no effect on the direction of American Creek i.e., American Creek and Magellan Gold go up and down completely randomly.
Pair Corralation between American Creek and Magellan Gold
Assuming the 90 days horizon American Creek Resources is expected to under-perform the Magellan Gold. But the otc stock apears to be less risky and, when comparing its historical volatility, American Creek Resources is 1.18 times less risky than Magellan Gold. The otc stock trades about -0.23 of its potential returns per unit of risk. The Magellan Gold Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 7.71 in Magellan Gold Corp on October 8, 2024 and sell it today you would earn a total of 0.49 from holding Magellan Gold Corp or generate 6.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Creek Resources vs. Magellan Gold Corp
Performance |
| Timeline |
| American Creek Resources |
| Magellan Gold Corp |
American Creek and Magellan Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Creek and Magellan Gold
The main advantage of trading using opposite American Creek and Magellan Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Creek position performs unexpectedly, Magellan Gold 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 Magellan Gold will offset losses from the drop in Magellan Gold's long position.| American Creek vs. Gold79 Mines | American Creek vs. Arctic Star Exploration | American Creek vs. American Clean Resources | American Creek vs. Arras Minerals Corp |
| Magellan Gold vs. Vortex Metals | Magellan Gold vs. Compania de Minas | Magellan Gold vs. American Copper Development | Magellan Gold vs. Triple Flag Precious |
Check out your portfolio center.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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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