Correlation Between Grande Portage and Blue Moon
Can any of the company-specific risk be diversified away by investing in both Grande Portage and Blue Moon 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 Grande Portage and Blue Moon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grande Portage Resources and Blue Moon Zinc, you can compare the effects of market volatilities on Grande Portage and Blue Moon 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 Grande Portage with a short position of Blue Moon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grande Portage and Blue Moon.
Diversification Opportunities for Grande Portage and Blue Moon
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Grande and Blue is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Grande Portage Resources and Blue Moon Zinc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Moon Zinc and Grande Portage 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 Grande Portage Resources are associated (or correlated) with Blue Moon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Moon Zinc has no effect on the direction of Grande Portage i.e., Grande Portage and Blue Moon go up and down completely randomly.
Pair Corralation between Grande Portage and Blue Moon
Assuming the 90 days horizon Grande Portage Resources is expected to under-perform the Blue Moon. In addition to that, Grande Portage is 6.99 times more volatile than Blue Moon Zinc. It trades about -0.14 of its total potential returns per unit of risk. Blue Moon Zinc is currently generating about 0.21 per unit of volatility. If you would invest 35.00 in Blue Moon Zinc on September 25, 2024 and sell it today you would earn a total of 1.00 from holding Blue Moon Zinc or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grande Portage Resources vs. Blue Moon Zinc
Performance |
| Timeline |
| Grande Portage Resources |
| Blue Moon Zinc |
Grande Portage and Blue Moon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grande Portage and Blue Moon
The main advantage of trading using opposite Grande Portage and Blue Moon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grande Portage position performs unexpectedly, Blue Moon 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 Blue Moon will offset losses from the drop in Blue Moon's long position.| Grande Portage vs. Wildsky Resources | Grande Portage vs. Q Gold Resources | Grande Portage vs. Plato Gold Corp | Grande Portage vs. MAS Gold Corp |
| Blue Moon vs. Monarca Minerals | Blue Moon vs. Outcrop Gold Corp | Blue Moon vs. Grande Portage Resources | Blue Moon vs. Klondike Silver Corp |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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