Correlation Between Aurion Resources and Grande Portage
Can any of the company-specific risk be diversified away by investing in both Aurion Resources and Grande Portage 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 Aurion Resources and Grande Portage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurion Resources and Grande Portage Resources, you can compare the effects of market volatilities on Aurion Resources and Grande Portage 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 Aurion Resources with a short position of Grande Portage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurion Resources and Grande Portage.
Diversification Opportunities for Aurion Resources and Grande Portage
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aurion and Grande is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Aurion Resources and Grande Portage Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grande Portage Resources and Aurion Resources 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 Aurion Resources are associated (or correlated) with Grande Portage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grande Portage Resources has no effect on the direction of Aurion Resources i.e., Aurion Resources and Grande Portage go up and down completely randomly.
Pair Corralation between Aurion Resources and Grande Portage
Assuming the 90 days horizon Aurion Resources is expected to generate 0.55 times more return on investment than Grande Portage. However, Aurion Resources is 1.81 times less risky than Grande Portage. It trades about -0.04 of its potential returns per unit of risk. Grande Portage Resources is currently generating about -0.04 per unit of risk. If you would invest 49.00 in Aurion Resources on November 7, 2024 and sell it today you would lose (5.00) from holding Aurion Resources or give up 10.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurion Resources vs. Grande Portage Resources
Performance |
| Timeline |
| Aurion Resources |
| Grande Portage Resources |
Aurion Resources and Grande Portage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurion Resources and Grande Portage
The main advantage of trading using opposite Aurion Resources and Grande Portage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurion Resources position performs unexpectedly, Grande Portage 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 Grande Portage will offset losses from the drop in Grande Portage's long position.| Aurion Resources vs. Minnova Corp | Aurion Resources vs. Argo Gold | Aurion Resources vs. Advance Gold Corp | Aurion Resources vs. Blue Star Gold |
| Grande Portage vs. Piedmont Lithium Ltd | Grande Portage vs. Sigma Lithium Resources | Grande Portage vs. Standard Lithium | Grande Portage vs. MP Materials Corp |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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