Correlation Between Gold Reserve and Ascendant Resources
Can any of the company-specific risk be diversified away by investing in both Gold Reserve 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 Gold Reserve and Ascendant Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gold Reserve and Ascendant Resources, you can compare the effects of market volatilities on Gold Reserve 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 Gold Reserve with a short position of Ascendant Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Reserve and Ascendant Resources.
Diversification Opportunities for Gold Reserve and Ascendant Resources
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gold and Ascendant is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Gold Reserve and Ascendant Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ascendant Resources and Gold Reserve 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 Reserve 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 Gold Reserve i.e., Gold Reserve and Ascendant Resources go up and down completely randomly.
Pair Corralation between Gold Reserve and Ascendant Resources
Assuming the 90 days horizon Gold Reserve is expected to under-perform the Ascendant Resources. But the otc stock apears to be less risky and, when comparing its historical volatility, Gold Reserve is 1.74 times less risky than Ascendant Resources. The otc stock trades about -0.03 of its potential returns per unit of risk. The Ascendant Resources is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 4.00 in Ascendant Resources on August 26, 2024 and sell it today you would lose (0.81) from holding Ascendant Resources or give up 20.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gold Reserve vs. Ascendant Resources
Performance |
| Timeline |
| Gold Reserve |
| Ascendant Resources |
Gold Reserve and Ascendant Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Reserve and Ascendant Resources
The main advantage of trading using opposite Gold Reserve and Ascendant Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Reserve 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.| Gold Reserve vs. Ascendant Resources | Gold Reserve vs. Cantex Mine Development | Gold Reserve vs. Amarc Resources | Gold Reserve vs. Sterling Metals Corp |
| 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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