Correlation Between Flinders Resources and Gunpoint Exploration
Can any of the company-specific risk be diversified away by investing in both Flinders Resources and Gunpoint Exploration 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 Flinders Resources and Gunpoint Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flinders Resources Limited and Gunpoint Exploration, you can compare the effects of market volatilities on Flinders Resources and Gunpoint Exploration 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 Flinders Resources with a short position of Gunpoint Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flinders Resources and Gunpoint Exploration.
Diversification Opportunities for Flinders Resources and Gunpoint Exploration
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Flinders and Gunpoint is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Flinders Resources Limited and Gunpoint Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gunpoint Exploration and Flinders 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 Flinders Resources Limited are associated (or correlated) with Gunpoint Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gunpoint Exploration has no effect on the direction of Flinders Resources i.e., Flinders Resources and Gunpoint Exploration go up and down completely randomly.
Pair Corralation between Flinders Resources and Gunpoint Exploration
Assuming the 90 days horizon Flinders Resources Limited is expected to generate 1.22 times more return on investment than Gunpoint Exploration. However, Flinders Resources is 1.22 times more volatile than Gunpoint Exploration. It trades about 0.14 of its potential returns per unit of risk. Gunpoint Exploration is currently generating about 0.04 per unit of risk. If you would invest 140.00 in Flinders Resources Limited on November 3, 2024 and sell it today you would earn a total of 430.00 from holding Flinders Resources Limited or generate 307.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flinders Resources Limited vs. Gunpoint Exploration
Performance |
| Timeline |
| Flinders Resources |
| Gunpoint Exploration |
Flinders Resources and Gunpoint Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flinders Resources and Gunpoint Exploration
The main advantage of trading using opposite Flinders Resources and Gunpoint Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flinders Resources position performs unexpectedly, Gunpoint Exploration 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 Gunpoint Exploration will offset losses from the drop in Gunpoint Exploration's long position.| Flinders Resources vs. Goodfood Market Corp | Flinders Resources vs. Cogeco Communications | Flinders Resources vs. BluMetric Environmental | Flinders Resources vs. Slate Grocery REIT |
| Gunpoint Exploration vs. Ramp Metals | Gunpoint Exploration vs. Plaza Retail REIT | Gunpoint Exploration vs. Mako Mining Corp | Gunpoint Exploration vs. Bird Construction |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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