Correlation Between Excellon Resources and Klondike Silver
Can any of the company-specific risk be diversified away by investing in both Excellon Resources and Klondike Silver 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 Excellon Resources and Klondike Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Excellon Resources and Klondike Silver Corp, you can compare the effects of market volatilities on Excellon Resources and Klondike Silver 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 Excellon Resources with a short position of Klondike Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Excellon Resources and Klondike Silver.
Diversification Opportunities for Excellon Resources and Klondike Silver
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Excellon and Klondike is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Excellon Resources and Klondike Silver Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klondike Silver Corp and Excellon 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 Excellon Resources are associated (or correlated) with Klondike Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klondike Silver Corp has no effect on the direction of Excellon Resources i.e., Excellon Resources and Klondike Silver go up and down completely randomly.
Pair Corralation between Excellon Resources and Klondike Silver
Assuming the 90 days trading horizon Excellon Resources is expected to generate 0.59 times more return on investment than Klondike Silver. However, Excellon Resources is 1.71 times less risky than Klondike Silver. It trades about -0.08 of its potential returns per unit of risk. Klondike Silver Corp is currently generating about -0.12 per unit of risk. If you would invest 11.00 in Excellon Resources on August 25, 2024 and sell it today you would lose (1.50) from holding Excellon Resources or give up 13.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Excellon Resources vs. Klondike Silver Corp
Performance |
| Timeline |
| Excellon Resources |
| Klondike Silver Corp |
Excellon Resources and Klondike Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Excellon Resources and Klondike Silver
The main advantage of trading using opposite Excellon Resources and Klondike Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Excellon Resources position performs unexpectedly, Klondike Silver 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 Klondike Silver will offset losses from the drop in Klondike Silver's long position.| Excellon Resources vs. Minco Silver | Excellon Resources vs. Americas Silver Corp | Excellon Resources vs. IMPACT Silver Corp | Excellon Resources vs. Dolly Varden Silver |
| Klondike Silver vs. Silver Grail Resources | Klondike Silver vs. Monarca Minerals | Klondike Silver vs. Gold79 Mines | Klondike Silver vs. Klondike Gold 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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