Correlation Between Baru Gold and Roscan Gold
Can any of the company-specific risk be diversified away by investing in both Baru Gold and Roscan 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 Baru Gold and Roscan Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baru Gold Corp and Roscan Gold Corp, you can compare the effects of market volatilities on Baru Gold and Roscan 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 Baru Gold with a short position of Roscan Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baru Gold and Roscan Gold.
Diversification Opportunities for Baru Gold and Roscan Gold
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Baru and Roscan is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Baru Gold Corp and Roscan Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roscan Gold Corp and Baru Gold 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 Baru Gold Corp are associated (or correlated) with Roscan Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roscan Gold Corp has no effect on the direction of Baru Gold i.e., Baru Gold and Roscan Gold go up and down completely randomly.
Pair Corralation between Baru Gold and Roscan Gold
Assuming the 90 days horizon Baru Gold Corp is expected to generate 1.27 times more return on investment than Roscan Gold. However, Baru Gold is 1.27 times more volatile than Roscan Gold Corp. It trades about 0.05 of its potential returns per unit of risk. Roscan Gold Corp is currently generating about 0.0 per unit of risk. If you would invest 4.26 in Baru Gold Corp on December 2, 2024 and sell it today you would earn a total of 0.20 from holding Baru Gold Corp or generate 4.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Baru Gold Corp vs. Roscan Gold Corp
Performance |
| Timeline |
| Baru Gold Corp |
| Roscan Gold Corp |
Baru Gold and Roscan Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baru Gold and Roscan Gold
The main advantage of trading using opposite Baru Gold and Roscan Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baru Gold position performs unexpectedly, Roscan 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 Roscan Gold will offset losses from the drop in Roscan Gold's long position.| Baru Gold vs. Allegiant Gold | Baru Gold vs. 1911 Gold Corp | Baru Gold vs. Altamira Gold Corp | Baru Gold vs. Gold Terra Resource |
| Roscan Gold vs. Aurion Resources | Roscan Gold vs. Minera Alamos | Roscan Gold vs. Rio2 Limited | Roscan Gold vs. Kalo Gold Holdings |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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