Correlation Between Aurion Resources and Lion One
Can any of the company-specific risk be diversified away by investing in both Aurion Resources and Lion One 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 Lion One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurion Resources and Lion One Metals, you can compare the effects of market volatilities on Aurion Resources and Lion One 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 Lion One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurion Resources and Lion One.
Diversification Opportunities for Aurion Resources and Lion One
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aurion and Lion is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Aurion Resources and Lion One Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion One Metals 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 Lion One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion One Metals has no effect on the direction of Aurion Resources i.e., Aurion Resources and Lion One go up and down completely randomly.
Pair Corralation between Aurion Resources and Lion One
Assuming the 90 days horizon Aurion Resources is expected to generate 0.95 times more return on investment than Lion One. However, Aurion Resources is 1.06 times less risky than Lion One. It trades about 0.05 of its potential returns per unit of risk. Lion One Metals is currently generating about -0.08 per unit of risk. If you would invest 29.00 in Aurion Resources on September 1, 2024 and sell it today you would earn a total of 12.00 from holding Aurion Resources or generate 41.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurion Resources vs. Lion One Metals
Performance |
| Timeline |
| Aurion Resources |
| Lion One Metals |
Aurion Resources and Lion One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurion Resources and Lion One
The main advantage of trading using opposite Aurion Resources and Lion One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurion Resources position performs unexpectedly, Lion One 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 Lion One will offset losses from the drop in Lion One'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 |
| Lion One vs. Irving Resources | Lion One vs. Headwater Gold | Lion One vs. Novo Resources Corp | Lion One vs. Snowline Gold 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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