Correlation Between Gold Bull and Orefinders Resources
Can any of the company-specific risk be diversified away by investing in both Gold Bull and Orefinders 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 Gold Bull and Orefinders Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gold Bull Resources and Orefinders Resources, you can compare the effects of market volatilities on Gold Bull and Orefinders 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 Gold Bull with a short position of Orefinders Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Bull and Orefinders Resources.
Diversification Opportunities for Gold Bull and Orefinders Resources
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Gold and Orefinders is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Gold Bull Resources and Orefinders Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orefinders Resources and Gold Bull 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 Gold Bull Resources are associated (or correlated) with Orefinders Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orefinders Resources has no effect on the direction of Gold Bull i.e., Gold Bull and Orefinders Resources go up and down completely randomly.
Pair Corralation between Gold Bull and Orefinders Resources
Assuming the 90 days horizon Gold Bull is expected to generate 5.68 times less return on investment than Orefinders Resources. In addition to that, Gold Bull is 1.07 times more volatile than Orefinders Resources. It trades about 0.01 of its total potential returns per unit of risk. Orefinders Resources is currently generating about 0.06 per unit of volatility. If you would invest 2.81 in Orefinders Resources on August 29, 2024 and sell it today you would earn a total of 2.19 from holding Orefinders Resources or generate 77.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gold Bull Resources vs. Orefinders Resources
Performance |
| Timeline |
| Gold Bull Resources |
| Orefinders Resources |
Gold Bull and Orefinders Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Bull and Orefinders Resources
The main advantage of trading using opposite Gold Bull and Orefinders Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Bull position performs unexpectedly, Orefinders 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 Orefinders Resources will offset losses from the drop in Orefinders Resources' long position.| Gold Bull vs. Aurion Resources | Gold Bull vs. Liberty Gold Corp | Gold Bull vs. Orezone Gold Corp | Gold Bull vs. Fortuna Silver Mines |
| Orefinders Resources vs. Aurion Resources | Orefinders Resources vs. Liberty Gold Corp | Orefinders Resources vs. Orezone Gold Corp | Orefinders Resources vs. Fortuna Silver Mines |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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