Correlation Between Amarc Resources and West High
Can any of the company-specific risk be diversified away by investing in both Amarc Resources and West High 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 Amarc Resources and West High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amarc Resources and West High Yield, you can compare the effects of market volatilities on Amarc Resources and West High 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 Amarc Resources with a short position of West High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amarc Resources and West High.
Diversification Opportunities for Amarc Resources and West High
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Amarc and West is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Amarc Resources and West High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on West High Yield and Amarc 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 Amarc Resources are associated (or correlated) with West High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of West High Yield has no effect on the direction of Amarc Resources i.e., Amarc Resources and West High go up and down completely randomly.
Pair Corralation between Amarc Resources and West High
Assuming the 90 days horizon Amarc Resources is expected to generate 0.86 times more return on investment than West High. However, Amarc Resources is 1.16 times less risky than West High. It trades about 0.06 of its potential returns per unit of risk. West High Yield is currently generating about 0.02 per unit of risk. If you would invest 9.00 in Amarc Resources on August 29, 2024 and sell it today you would earn a total of 4.00 from holding Amarc Resources or generate 44.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.52% |
| Values | Daily Returns |
Amarc Resources vs. West High Yield
Performance |
| Timeline |
| Amarc Resources |
| West High Yield |
Amarc Resources and West High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amarc Resources and West High
The main advantage of trading using opposite Amarc Resources and West High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amarc Resources position performs unexpectedly, West High 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 West High will offset losses from the drop in West High's long position.| Amarc Resources vs. Durango Resources | Amarc Resources vs. Avarone Metals | Amarc Resources vs. Pampa Metals | Amarc Resources vs. Sun Summit Minerals |
| West High vs. BCM Resources | West High vs. Standard Lithium | West High vs. Aurelia Metals Limited | West High vs. Juggernaut Exploration |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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