Correlation Between Dundee Precious and Ascendant Resources
Can any of the company-specific risk be diversified away by investing in both Dundee Precious and Ascendant 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 Dundee Precious and Ascendant Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dundee Precious Metals and Ascendant Resources, you can compare the effects of market volatilities on Dundee Precious and Ascendant 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 Dundee Precious with a short position of Ascendant Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dundee Precious and Ascendant Resources.
Diversification Opportunities for Dundee Precious and Ascendant Resources
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dundee and Ascendant is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Dundee Precious Metals and Ascendant Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ascendant Resources and Dundee Precious 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 Dundee Precious Metals are associated (or correlated) with Ascendant Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ascendant Resources has no effect on the direction of Dundee Precious i.e., Dundee Precious and Ascendant Resources go up and down completely randomly.
Pair Corralation between Dundee Precious and Ascendant Resources
Assuming the 90 days horizon Dundee Precious Metals is expected to under-perform the Ascendant Resources. But the pink sheet apears to be less risky and, when comparing its historical volatility, Dundee Precious Metals is 6.69 times less risky than Ascendant Resources. The pink sheet trades about -0.18 of its potential returns per unit of risk. The Ascendant Resources is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 4.00 in Ascendant Resources on August 29, 2024 and sell it today you would lose (0.68) from holding Ascendant Resources or give up 17.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dundee Precious Metals vs. Ascendant Resources
Performance |
| Timeline |
| Dundee Precious Metals |
| Ascendant Resources |
Dundee Precious and Ascendant Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dundee Precious and Ascendant Resources
The main advantage of trading using opposite Dundee Precious and Ascendant Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dundee Precious position performs unexpectedly, Ascendant 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 Ascendant Resources will offset losses from the drop in Ascendant Resources' long position.| Dundee Precious vs. Silver Hammer Mining | Dundee Precious vs. Reyna Silver Corp | Dundee Precious vs. Guanajuato Silver | Dundee Precious vs. Silver One Resources |
| Ascendant Resources vs. Rockridge Resources | Ascendant Resources vs. Vital Metals Limited | Ascendant Resources vs. Ameriwest Lithium | Ascendant Resources vs. Osisko Metals Incorporated |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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