Correlation Between Aurion Resources and Viva Gold
Can any of the company-specific risk be diversified away by investing in both Aurion Resources and Viva 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 Aurion Resources and Viva Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurion Resources and Viva Gold Corp, you can compare the effects of market volatilities on Aurion Resources and Viva 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 Aurion Resources with a short position of Viva Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurion Resources and Viva Gold.
Diversification Opportunities for Aurion Resources and Viva Gold
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aurion and Viva is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Aurion Resources and Viva Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viva Gold Corp 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 Viva Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viva Gold Corp has no effect on the direction of Aurion Resources i.e., Aurion Resources and Viva Gold go up and down completely randomly.
Pair Corralation between Aurion Resources and Viva Gold
Assuming the 90 days horizon Aurion Resources is expected to generate 2.58 times less return on investment than Viva Gold. But when comparing it to its historical volatility, Aurion Resources is 1.55 times less risky than Viva Gold. It trades about 0.02 of its potential returns per unit of risk. Viva Gold Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 10.00 in Viva Gold Corp on September 3, 2024 and sell it today you would earn a total of 2.00 from holding Viva Gold Corp or generate 20.0% 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. Viva Gold Corp
Performance |
| Timeline |
| Aurion Resources |
| Viva Gold Corp |
Aurion Resources and Viva Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurion Resources and Viva Gold
The main advantage of trading using opposite Aurion Resources and Viva Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurion Resources position performs unexpectedly, Viva 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 Viva Gold will offset losses from the drop in Viva Gold'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 |
| Viva Gold vs. Antioquia Gold | Viva Gold vs. Asante Gold | Viva Gold vs. Bluestone Resources | Viva Gold vs. Allegiant Gold |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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