Correlation Between Expand Energy and P2 Gold
Can any of the company-specific risk be diversified away by investing in both Expand Energy and P2 Gold 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 Expand Energy and P2 Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Expand Energy and P2 Gold, you can compare the effects of market volatilities on Expand Energy and P2 Gold 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 Expand Energy with a short position of P2 Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Expand Energy and P2 Gold.
Diversification Opportunities for Expand Energy and P2 Gold
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Expand and PGLDF is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Expand Energy and P2 Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on P2 Gold and Expand Energy 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 Expand Energy are associated (or correlated) with P2 Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of P2 Gold has no effect on the direction of Expand Energy i.e., Expand Energy and P2 Gold go up and down completely randomly.
Pair Corralation between Expand Energy and P2 Gold
Assuming the 90 days horizon Expand Energy is expected to generate 1.55 times less return on investment than P2 Gold. But when comparing it to its historical volatility, Expand Energy is 4.01 times less risky than P2 Gold. It trades about 0.35 of its potential returns per unit of risk. P2 Gold is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 4.20 in P2 Gold on November 3, 2024 and sell it today you would earn a total of 0.70 from holding P2 Gold or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Expand Energy vs. P2 Gold
Performance |
| Timeline |
| Expand Energy |
| P2 Gold |
Expand Energy and P2 Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Expand Energy and P2 Gold
The main advantage of trading using opposite Expand Energy and P2 Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Expand Energy position performs unexpectedly, P2 Gold 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 P2 Gold will offset losses from the drop in P2 Gold's long position.| Expand Energy vs. Grupo Aeroportuario del | Expand Energy vs. Mako Mining Corp | Expand Energy vs. ioneer Ltd American | Expand Energy vs. Harmony Gold Mining |
| P2 Gold vs. Max Resource Corp | P2 Gold vs. Western Alaska Minerals | P2 Gold vs. CMC Metals | P2 Gold vs. Summa Silver Corp |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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