Correlation Between BTU Metals and Tudor Gold
Can any of the company-specific risk be diversified away by investing in both BTU Metals and Tudor 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 BTU Metals and Tudor Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BTU Metals Corp and Tudor Gold Corp, you can compare the effects of market volatilities on BTU Metals and Tudor 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 BTU Metals with a short position of Tudor Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTU Metals and Tudor Gold.
Diversification Opportunities for BTU Metals and Tudor Gold
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between BTU and Tudor is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding BTU Metals Corp and Tudor Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tudor Gold Corp and BTU Metals 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 BTU Metals Corp are associated (or correlated) with Tudor Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tudor Gold Corp has no effect on the direction of BTU Metals i.e., BTU Metals and Tudor Gold go up and down completely randomly.
Pair Corralation between BTU Metals and Tudor Gold
Assuming the 90 days horizon BTU Metals Corp is expected to generate 0.43 times more return on investment than Tudor Gold. However, BTU Metals Corp is 2.34 times less risky than Tudor Gold. It trades about 0.21 of its potential returns per unit of risk. Tudor Gold Corp is currently generating about -0.24 per unit of risk. If you would invest 1.91 in BTU Metals Corp on September 2, 2024 and sell it today you would earn a total of 0.14 from holding BTU Metals Corp or generate 7.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
BTU Metals Corp vs. Tudor Gold Corp
Performance |
| Timeline |
| BTU Metals Corp |
| Tudor Gold Corp |
BTU Metals and Tudor Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTU Metals and Tudor Gold
The main advantage of trading using opposite BTU Metals and Tudor Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTU Metals position performs unexpectedly, Tudor 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 Tudor Gold will offset losses from the drop in Tudor Gold's long position.| BTU Metals vs. Aurion Resources | BTU Metals vs. Rio2 Limited | BTU Metals vs. Palamina Corp | BTU Metals vs. Grande Portage Resources |
| Tudor Gold vs. Fremont Gold | Tudor Gold vs. Norsemont Mining | Tudor Gold vs. Hummingbird Resources PLC | Tudor Gold vs. Rio2 Limited |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Global Correlations Find global opportunities by holding instruments from different markets |