Correlation Between GoGold Resources and Hecla Mining
Can any of the company-specific risk be diversified away by investing in both GoGold Resources and Hecla Mining 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 GoGold Resources and Hecla Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GoGold Resources and Hecla Mining, you can compare the effects of market volatilities on GoGold Resources and Hecla Mining 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 GoGold Resources with a short position of Hecla Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of GoGold Resources and Hecla Mining.
Diversification Opportunities for GoGold Resources and Hecla Mining
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GoGold and Hecla is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding GoGold Resources and Hecla Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hecla Mining and GoGold 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 GoGold Resources are associated (or correlated) with Hecla Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hecla Mining has no effect on the direction of GoGold Resources i.e., GoGold Resources and Hecla Mining go up and down completely randomly.
Pair Corralation between GoGold Resources and Hecla Mining
Assuming the 90 days horizon GoGold Resources is expected to under-perform the Hecla Mining. In addition to that, GoGold Resources is 1.39 times more volatile than Hecla Mining. It trades about -0.32 of its total potential returns per unit of risk. Hecla Mining is currently generating about -0.34 per unit of volatility. If you would invest 638.00 in Hecla Mining on September 2, 2024 and sell it today you would lose (86.00) from holding Hecla Mining or give up 13.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GoGold Resources vs. Hecla Mining
Performance |
| Timeline |
| GoGold Resources |
| Hecla Mining |
GoGold Resources and Hecla Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GoGold Resources and Hecla Mining
The main advantage of trading using opposite GoGold Resources and Hecla Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GoGold Resources position performs unexpectedly, Hecla Mining 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 Hecla Mining will offset losses from the drop in Hecla Mining's long position.| GoGold Resources vs. Regenx Tech Corp | GoGold Resources vs. P2 Gold | GoGold Resources vs. Max Resource Corp | GoGold Resources vs. Pacific Ridge Exploration |
| Hecla Mining vs. SilverCrest Metals | Hecla Mining vs. McEwen Mining | Hecla Mining vs. Avino Silver Gold | Hecla Mining vs. Metalla Royalty Streaming |
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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