Correlation Between Edison Cobalt and Golden Goliath
Can any of the company-specific risk be diversified away by investing in both Edison Cobalt 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 Edison Cobalt and Golden Goliath into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Edison Cobalt Corp and Golden Goliath Resources, you can compare the effects of market volatilities on Edison Cobalt 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 Edison Cobalt with a short position of Golden Goliath. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edison Cobalt and Golden Goliath.
Diversification Opportunities for Edison Cobalt and Golden Goliath
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Edison and Golden is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Edison Cobalt Corp 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 Edison Cobalt 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 Edison Cobalt Corp 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 Edison Cobalt i.e., Edison Cobalt and Golden Goliath go up and down completely randomly.
Pair Corralation between Edison Cobalt and Golden Goliath
Assuming the 90 days horizon Edison Cobalt is expected to generate 26.8 times less return on investment than Golden Goliath. But when comparing it to its historical volatility, Edison Cobalt Corp is 7.28 times less risky than Golden Goliath. It trades about 0.05 of its potential returns per unit of risk. Golden Goliath Resources is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 9.00 in Golden Goliath Resources on August 25, 2024 and sell it today you would lose (3.00) from holding Golden Goliath Resources or give up 33.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 93.33% |
| Values | Daily Returns |
Edison Cobalt Corp vs. Golden Goliath Resources
Performance |
| Timeline |
| Edison Cobalt Corp |
| Golden Goliath Resources |
Edison Cobalt and Golden Goliath Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Edison Cobalt and Golden Goliath
The main advantage of trading using opposite Edison Cobalt and Golden Goliath positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Edison Cobalt 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.| Edison Cobalt vs. Norra Metals Corp | Edison Cobalt vs. ZincX Resources Corp | Edison Cobalt vs. Nuinsco Resources Limited | Edison Cobalt vs. South Star Battery |
| Golden Goliath vs. Silver Spruce Resources | Golden Goliath vs. Portofino Resources | Golden Goliath vs. Freegold Ventures Limited | Golden Goliath vs. Bravada Gold |
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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