Correlation Between AKITA Drilling and Q Gold
Can any of the company-specific risk be diversified away by investing in both AKITA Drilling and Q 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 AKITA Drilling and Q Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AKITA Drilling and Q Gold Resources, you can compare the effects of market volatilities on AKITA Drilling and Q 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 AKITA Drilling with a short position of Q Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of AKITA Drilling and Q Gold.
Diversification Opportunities for AKITA Drilling and Q Gold
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AKITA and QGR is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding AKITA Drilling and Q Gold Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Q Gold Resources and AKITA Drilling 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 AKITA Drilling are associated (or correlated) with Q Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Q Gold Resources has no effect on the direction of AKITA Drilling i.e., AKITA Drilling and Q Gold go up and down completely randomly.
Pair Corralation between AKITA Drilling and Q Gold
Assuming the 90 days trading horizon AKITA Drilling is expected to generate 40.59 times less return on investment than Q Gold. But when comparing it to its historical volatility, AKITA Drilling is 7.19 times less risky than Q Gold. It trades about 0.02 of its potential returns per unit of risk. Q Gold Resources is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 2.00 in Q Gold Resources on September 12, 2024 and sell it today you would earn a total of 15.00 from holding Q Gold Resources or generate 750.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AKITA Drilling vs. Q Gold Resources
Performance |
| Timeline |
| AKITA Drilling |
| Q Gold Resources |
AKITA Drilling and Q Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AKITA Drilling and Q Gold
The main advantage of trading using opposite AKITA Drilling and Q Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AKITA Drilling position performs unexpectedly, Q 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 Q Gold will offset losses from the drop in Q Gold's long position.| AKITA Drilling vs. Enbridge Pref 5 | AKITA Drilling vs. Enbridge Pref 11 | AKITA Drilling vs. Enbridge Pref L | AKITA Drilling vs. E Split Corp |
| Q Gold vs. Major Drilling Group | Q Gold vs. High Liner Foods | Q Gold vs. Sparx Technology | Q Gold vs. AKITA Drilling |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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