Correlation Between Champion Bear and Harfang Exploration
Can any of the company-specific risk be diversified away by investing in both Champion Bear and Harfang Exploration 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 Champion Bear and Harfang Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Champion Bear Resources and Harfang Exploration, you can compare the effects of market volatilities on Champion Bear and Harfang Exploration 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 Champion Bear with a short position of Harfang Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Champion Bear and Harfang Exploration.
Diversification Opportunities for Champion Bear and Harfang Exploration
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Champion and Harfang is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Champion Bear Resources and Harfang Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harfang Exploration and Champion Bear 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 Champion Bear Resources are associated (or correlated) with Harfang Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harfang Exploration has no effect on the direction of Champion Bear i.e., Champion Bear and Harfang Exploration go up and down completely randomly.
Pair Corralation between Champion Bear and Harfang Exploration
Assuming the 90 days horizon Champion Bear Resources is expected to under-perform the Harfang Exploration. In addition to that, Champion Bear is 1.06 times more volatile than Harfang Exploration. It trades about -0.22 of its total potential returns per unit of risk. Harfang Exploration is currently generating about 0.22 per unit of volatility. If you would invest 4.54 in Harfang Exploration on September 3, 2024 and sell it today you would earn a total of 1.46 from holding Harfang Exploration or generate 32.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Champion Bear Resources vs. Harfang Exploration
Performance |
| Timeline |
| Champion Bear Resources |
| Harfang Exploration |
Champion Bear and Harfang Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Champion Bear and Harfang Exploration
The main advantage of trading using opposite Champion Bear and Harfang Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Champion Bear position performs unexpectedly, Harfang Exploration 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 Harfang Exploration will offset losses from the drop in Harfang Exploration's long position.| Champion Bear vs. Aurelia Metals Limited | Champion Bear vs. Baroyeca Gold Silver | Champion Bear vs. Centaurus Metals Limited | Champion Bear vs. Edison Cobalt Corp |
| Harfang Exploration vs. Champion Bear Resources | Harfang Exploration vs. Edison Cobalt Corp | Harfang Exploration vs. Aurelia Metals Limited | Harfang Exploration vs. Fury Gold Mines |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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