Correlation Between Eminent Gold and Thunderstruck Resources
Can any of the company-specific risk be diversified away by investing in both Eminent Gold and Thunderstruck 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 Eminent Gold and Thunderstruck Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eminent Gold Corp and Thunderstruck Resources, you can compare the effects of market volatilities on Eminent Gold and Thunderstruck 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 Eminent Gold with a short position of Thunderstruck Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eminent Gold and Thunderstruck Resources.
Diversification Opportunities for Eminent Gold and Thunderstruck Resources
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eminent and Thunderstruck is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Eminent Gold Corp and Thunderstruck Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thunderstruck Resources and Eminent 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 Eminent Gold Corp are associated (or correlated) with Thunderstruck Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thunderstruck Resources has no effect on the direction of Eminent Gold i.e., Eminent Gold and Thunderstruck Resources go up and down completely randomly.
Pair Corralation between Eminent Gold and Thunderstruck Resources
Assuming the 90 days horizon Eminent Gold Corp is expected to under-perform the Thunderstruck Resources. But the otc stock apears to be less risky and, when comparing its historical volatility, Eminent Gold Corp is 8.81 times less risky than Thunderstruck Resources. The otc stock trades about -0.13 of its potential returns per unit of risk. The Thunderstruck Resources is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 4.50 in Thunderstruck Resources on August 29, 2024 and sell it today you would lose (0.50) from holding Thunderstruck Resources or give up 11.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Eminent Gold Corp vs. Thunderstruck Resources
Performance |
| Timeline |
| Eminent Gold Corp |
| Thunderstruck Resources |
Eminent Gold and Thunderstruck Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eminent Gold and Thunderstruck Resources
The main advantage of trading using opposite Eminent Gold and Thunderstruck Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eminent Gold position performs unexpectedly, Thunderstruck 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 Thunderstruck Resources will offset losses from the drop in Thunderstruck Resources' long position.| Eminent Gold vs. Thunderstruck Resources | Eminent Gold vs. Aston Minerals | Eminent Gold vs. Tarku Resources | Eminent Gold vs. Murchison Minerals |
| Thunderstruck Resources vs. Rockridge Resources | Thunderstruck Resources vs. Vital Metals Limited | Thunderstruck Resources vs. Ameriwest Lithium | Thunderstruck 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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