Correlation Between Austral Gold and Kodiak Copper
Can any of the company-specific risk be diversified away by investing in both Austral Gold and Kodiak Copper 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 Austral Gold and Kodiak Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Austral Gold Limited and Kodiak Copper Corp, you can compare the effects of market volatilities on Austral Gold and Kodiak Copper 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 Austral Gold with a short position of Kodiak Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austral Gold and Kodiak Copper.
Diversification Opportunities for Austral Gold and Kodiak Copper
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Austral and Kodiak is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Austral Gold Limited and Kodiak Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kodiak Copper Corp and Austral Gold 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 Austral Gold Limited are associated (or correlated) with Kodiak Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kodiak Copper Corp has no effect on the direction of Austral Gold i.e., Austral Gold and Kodiak Copper go up and down completely randomly.
Pair Corralation between Austral Gold and Kodiak Copper
Assuming the 90 days horizon Austral Gold Limited is expected to generate 11.24 times more return on investment than Kodiak Copper. However, Austral Gold is 11.24 times more volatile than Kodiak Copper Corp. It trades about 0.18 of its potential returns per unit of risk. Kodiak Copper Corp is currently generating about -0.17 per unit of risk. If you would invest 1.75 in Austral Gold Limited on August 28, 2024 and sell it today you would earn a total of 0.31 from holding Austral Gold Limited or generate 17.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Austral Gold Limited vs. Kodiak Copper Corp
Performance |
| Timeline |
| Austral Gold Limited |
| Kodiak Copper Corp |
Austral Gold and Kodiak Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austral Gold and Kodiak Copper
The main advantage of trading using opposite Austral Gold and Kodiak Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austral Gold position performs unexpectedly, Kodiak Copper 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 Kodiak Copper will offset losses from the drop in Kodiak Copper's long position.| Austral Gold vs. Gold79 Mines | Austral Gold vs. Arctic Star Exploration | Austral Gold vs. American Clean Resources | Austral Gold vs. Arras Minerals Corp |
| Kodiak Copper vs. Silver Tiger Metals | Kodiak Copper vs. P2 Gold | Kodiak Copper vs. Integra Resources Corp | Kodiak Copper vs. SilverCrest Metals |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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