Correlation Between Bear Creek and Golden Goliath
Can any of the company-specific risk be diversified away by investing in both Bear Creek and Golden Goliath 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 Bear Creek and Golden Goliath into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bear Creek Mining and Golden Goliath Resources, you can compare the effects of market volatilities on Bear Creek and Golden Goliath 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 Bear Creek with a short position of Golden Goliath. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bear Creek and Golden Goliath.
Diversification Opportunities for Bear Creek and Golden Goliath
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bear and Golden is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Bear Creek Mining and Golden Goliath Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Goliath Resources and Bear Creek 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 Bear Creek Mining are associated (or correlated) with Golden Goliath. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Goliath Resources has no effect on the direction of Bear Creek i.e., Bear Creek and Golden Goliath go up and down completely randomly.
Pair Corralation between Bear Creek and Golden Goliath
Assuming the 90 days horizon Bear Creek Mining is expected to generate 0.85 times more return on investment than Golden Goliath. However, Bear Creek Mining is 1.18 times less risky than Golden Goliath. It trades about 0.1 of its potential returns per unit of risk. Golden Goliath Resources is currently generating about 0.04 per unit of risk. If you would invest 35.00 in Bear Creek Mining on August 28, 2024 and sell it today you would earn a total of 8.00 from holding Bear Creek Mining or generate 22.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bear Creek Mining vs. Golden Goliath Resources
Performance |
| Timeline |
| Bear Creek Mining |
| Golden Goliath Resources |
Bear Creek and Golden Goliath Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bear Creek and Golden Goliath
The main advantage of trading using opposite Bear Creek and Golden Goliath positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bear Creek position performs unexpectedly, Golden Goliath 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 Golden Goliath will offset losses from the drop in Golden Goliath's long position.| Bear Creek vs. IMPACT Silver Corp | Bear Creek vs. Golden Goliath Resources | Bear Creek vs. Minera Alamos | Bear Creek vs. Chesapeake Gold Corp |
| Golden Goliath vs. First Majestic Silver | Golden Goliath vs. Ivanhoe Energy | Golden Goliath vs. Orezone Gold Corp | Golden Goliath vs. Faraday Copper 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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