Correlation Between Cassiar Gold and AbraSilver Resource
Can any of the company-specific risk be diversified away by investing in both Cassiar Gold and AbraSilver Resource 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 Cassiar Gold and AbraSilver Resource into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cassiar Gold Corp and AbraSilver Resource Corp, you can compare the effects of market volatilities on Cassiar Gold and AbraSilver Resource 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 Cassiar Gold with a short position of AbraSilver Resource. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cassiar Gold and AbraSilver Resource.
Diversification Opportunities for Cassiar Gold and AbraSilver Resource
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cassiar and AbraSilver is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Cassiar Gold Corp and AbraSilver Resource Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AbraSilver Resource Corp and Cassiar Gold 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 Cassiar Gold Corp are associated (or correlated) with AbraSilver Resource. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AbraSilver Resource Corp has no effect on the direction of Cassiar Gold i.e., Cassiar Gold and AbraSilver Resource go up and down completely randomly.
Pair Corralation between Cassiar Gold and AbraSilver Resource
Assuming the 90 days trading horizon Cassiar Gold Corp is expected to under-perform the AbraSilver Resource. But the stock apears to be less risky and, when comparing its historical volatility, Cassiar Gold Corp is 1.23 times less risky than AbraSilver Resource. The stock trades about -0.1 of its potential returns per unit of risk. The AbraSilver Resource Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 274.00 in AbraSilver Resource Corp on October 24, 2024 and sell it today you would lose (1.00) from holding AbraSilver Resource Corp or give up 0.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cassiar Gold Corp vs. AbraSilver Resource Corp
Performance |
| Timeline |
| Cassiar Gold Corp |
| AbraSilver Resource Corp |
Cassiar Gold and AbraSilver Resource Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cassiar Gold and AbraSilver Resource
The main advantage of trading using opposite Cassiar Gold and AbraSilver Resource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cassiar Gold position performs unexpectedly, AbraSilver Resource 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 AbraSilver Resource will offset losses from the drop in AbraSilver Resource's long position.| Cassiar Gold vs. A W FOOD | Cassiar Gold vs. Profound Medical Corp | Cassiar Gold vs. MTY Food Group | Cassiar Gold vs. Guru Organic Energy |
| AbraSilver Resource vs. Defiance Silver Corp | AbraSilver Resource vs. Santacruz Silv | AbraSilver Resource vs. Guanajuato Silver | AbraSilver Resource vs. Aftermath Silver |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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