Correlation Between Global Energy and Ascendant Resources
Can any of the company-specific risk be diversified away by investing in both Global Energy and Ascendant 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 Global Energy and Ascendant Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Energy Metals and Ascendant Resources, you can compare the effects of market volatilities on Global Energy and Ascendant 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 Global Energy with a short position of Ascendant Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Energy and Ascendant Resources.
Diversification Opportunities for Global Energy and Ascendant Resources
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Ascendant is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Global Energy Metals and Ascendant Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ascendant Resources and Global 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 Global Energy Metals are associated (or correlated) with Ascendant Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ascendant Resources has no effect on the direction of Global Energy i.e., Global Energy and Ascendant Resources go up and down completely randomly.
Pair Corralation between Global Energy and Ascendant Resources
Assuming the 90 days horizon Global Energy is expected to generate 1.02 times less return on investment than Ascendant Resources. In addition to that, Global Energy is 1.0 times more volatile than Ascendant Resources. It trades about 0.01 of its total potential returns per unit of risk. Ascendant Resources is currently generating about 0.01 per unit of volatility. If you would invest 13.00 in Ascendant Resources on September 3, 2024 and sell it today you would lose (10.00) from holding Ascendant Resources or give up 76.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Global Energy Metals vs. Ascendant Resources
Performance |
| Timeline |
| Global Energy Metals |
| Ascendant Resources |
Global Energy and Ascendant Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Energy and Ascendant Resources
The main advantage of trading using opposite Global Energy and Ascendant Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Energy position performs unexpectedly, Ascendant 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 Ascendant Resources will offset losses from the drop in Ascendant Resources' long position.| Global Energy vs. Golden Goliath Resources | Global Energy vs. Fireweed Zinc | Global Energy vs. Monitor Ventures | Global Energy vs. Lithium Australia NL |
| Ascendant Resources vs. Edison Cobalt Corp | Ascendant Resources vs. Champion Bear Resources | Ascendant Resources vs. Avarone Metals | Ascendant Resources vs. Adriatic Metals PLC |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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