Correlation Between Entree Resources and Excellon Resources
Can any of the company-specific risk be diversified away by investing in both Entree Resources and Excellon 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 Entree Resources and Excellon Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Entree Resources and Excellon Resources, you can compare the effects of market volatilities on Entree Resources and Excellon 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 Entree Resources with a short position of Excellon Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Entree Resources and Excellon Resources.
Diversification Opportunities for Entree Resources and Excellon Resources
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Entree and Excellon is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Entree Resources and Excellon Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Excellon Resources and Entree Resources 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 Entree Resources are associated (or correlated) with Excellon Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Excellon Resources has no effect on the direction of Entree Resources i.e., Entree Resources and Excellon Resources go up and down completely randomly.
Pair Corralation between Entree Resources and Excellon Resources
Assuming the 90 days trading horizon Entree Resources is expected to generate 0.31 times more return on investment than Excellon Resources. However, Entree Resources is 3.18 times less risky than Excellon Resources. It trades about 0.07 of its potential returns per unit of risk. Excellon Resources is currently generating about 0.01 per unit of risk. If you would invest 132.00 in Entree Resources on November 27, 2024 and sell it today you would earn a total of 119.00 from holding Entree Resources or generate 90.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Entree Resources vs. Excellon Resources
Performance |
| Timeline |
| Entree Resources |
| Excellon Resources |
Entree Resources and Excellon Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Entree Resources and Excellon Resources
The main advantage of trading using opposite Entree Resources and Excellon Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Entree Resources position performs unexpectedly, Excellon 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 Excellon Resources will offset losses from the drop in Excellon Resources' long position.| Entree Resources vs. Solitario Exploration Royalty | Entree Resources vs. Globex Mining Enterprises | Entree Resources vs. Northcliff Resources | Entree Resources vs. St Augustine Gold |
| Excellon Resources vs. Minco Silver | Excellon Resources vs. Americas Silver Corp | Excellon Resources vs. IMPACT Silver Corp | Excellon Resources vs. Dolly Varden Silver |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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