Correlation Between Cabral Gold and Robex Resources
Can any of the company-specific risk be diversified away by investing in both Cabral Gold and Robex Resources 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 Cabral Gold and Robex Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cabral Gold and Robex Resources, you can compare the effects of market volatilities on Cabral Gold and Robex Resources 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 Cabral Gold with a short position of Robex Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cabral Gold and Robex Resources.
Diversification Opportunities for Cabral Gold and Robex Resources
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cabral and Robex is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Cabral Gold and Robex Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robex Resources and Cabral 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 Cabral Gold are associated (or correlated) with Robex Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robex Resources has no effect on the direction of Cabral Gold i.e., Cabral Gold and Robex Resources go up and down completely randomly.
Pair Corralation between Cabral Gold and Robex Resources
Assuming the 90 days horizon Cabral Gold is expected to generate 6.75 times less return on investment than Robex Resources. But when comparing it to its historical volatility, Cabral Gold is 7.34 times less risky than Robex Resources. It trades about 0.06 of its potential returns per unit of risk. Robex Resources is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 210.00 in Robex Resources on November 21, 2024 and sell it today you would lose (30.00) from holding Robex Resources or give up 14.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 54.66% |
| Values | Daily Returns |
Cabral Gold vs. Robex Resources
Performance |
| Timeline |
| Cabral Gold |
| Robex Resources |
Cabral Gold and Robex Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cabral Gold and Robex Resources
The main advantage of trading using opposite Cabral Gold and Robex Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cabral Gold position performs unexpectedly, Robex Resources 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 Robex Resources will offset losses from the drop in Robex Resources' long position.| Cabral Gold vs. Puma Exploration | Cabral Gold vs. Endurance Gold | Cabral Gold vs. Red Pine Exploration | Cabral Gold vs. Fremont Gold |
| Robex Resources vs. Orefinders Resources | Robex Resources vs. Leviathan Gold | Robex Resources vs. Gold Bull Resources | Robex Resources vs. Rackla Metals |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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