Correlation Between Bluestone Resources and Viva Gold
Can any of the company-specific risk be diversified away by investing in both Bluestone 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 Bluestone 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 Bluestone Resources and Viva Gold Corp, you can compare the effects of market volatilities on Bluestone 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 Bluestone Resources with a short position of Viva Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bluestone Resources and Viva Gold.
Diversification Opportunities for Bluestone Resources and Viva Gold
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bluestone and Viva is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Bluestone 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 Bluestone 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 Bluestone 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 Bluestone Resources i.e., Bluestone Resources and Viva Gold go up and down completely randomly.
Pair Corralation between Bluestone Resources and Viva Gold
Assuming the 90 days horizon Bluestone Resources is expected to generate 3.13 times less return on investment than Viva Gold. But when comparing it to its historical volatility, Bluestone Resources is 4.02 times less risky than Viva Gold. It trades about 0.01 of its potential returns per unit of risk. Viva Gold Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Viva Gold Corp on September 1, 2024 and sell it today you would lose (1.00) from holding Viva Gold Corp or give up 7.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bluestone Resources vs. Viva Gold Corp
Performance |
| Timeline |
| Bluestone Resources |
| Viva Gold Corp |
Bluestone Resources and Viva Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bluestone Resources and Viva Gold
The main advantage of trading using opposite Bluestone Resources and Viva Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bluestone 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.| Bluestone Resources vs. Minnova Corp | Bluestone Resources vs. Argo Gold | Bluestone Resources vs. Advance Gold Corp | Bluestone Resources vs. Blue Star Gold |
| Viva Gold vs. Aurion Resources | Viva Gold vs. Rio2 Limited | Viva Gold vs. Palamina Corp | Viva Gold vs. BTU Metals Corp |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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