Correlation Between Big Ridge and Aurion Resources
Can any of the company-specific risk be diversified away by investing in both Big Ridge and Aurion Resources 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 Big Ridge and Aurion Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Big Ridge Gold and Aurion Resources, you can compare the effects of market volatilities on Big Ridge and Aurion Resources 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 Big Ridge with a short position of Aurion Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Big Ridge and Aurion Resources.
Diversification Opportunities for Big Ridge and Aurion Resources
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Big and Aurion is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Big Ridge Gold and Aurion Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurion Resources and Big Ridge 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 Big Ridge Gold are associated (or correlated) with Aurion Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurion Resources has no effect on the direction of Big Ridge i.e., Big Ridge and Aurion Resources go up and down completely randomly.
Pair Corralation between Big Ridge and Aurion Resources
Assuming the 90 days horizon Big Ridge Gold is expected to generate 1.64 times more return on investment than Aurion Resources. However, Big Ridge is 1.64 times more volatile than Aurion Resources. It trades about -0.08 of its potential returns per unit of risk. Aurion Resources is currently generating about -0.14 per unit of risk. If you would invest 8.00 in Big Ridge Gold on August 29, 2024 and sell it today you would lose (1.21) from holding Big Ridge Gold or give up 15.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Big Ridge Gold vs. Aurion Resources
Performance |
| Timeline |
| Big Ridge Gold |
| Aurion Resources |
Big Ridge and Aurion Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Big Ridge and Aurion Resources
The main advantage of trading using opposite Big Ridge and Aurion Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Big Ridge position performs unexpectedly, Aurion Resources 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 Aurion Resources will offset losses from the drop in Aurion Resources' long position.| Big Ridge vs. Vertiv Holdings Co | Big Ridge vs. Nasdaq Inc | Big Ridge vs. McDonalds | Big Ridge vs. Walmart |
| Aurion Resources vs. Minnova Corp | Aurion Resources vs. Argo Gold | Aurion Resources vs. Advance Gold Corp | Aurion Resources vs. Blue Star 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |