Correlation Between Great Atlantic and Gossan Resources
Can any of the company-specific risk be diversified away by investing in both Great Atlantic and Gossan 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 Great Atlantic and Gossan Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Great Atlantic Resources and Gossan Resources, you can compare the effects of market volatilities on Great Atlantic and Gossan 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 Great Atlantic with a short position of Gossan Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great Atlantic and Gossan Resources.
Diversification Opportunities for Great Atlantic and Gossan Resources
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Great and Gossan is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Great Atlantic Resources and Gossan Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gossan Resources and Great Atlantic 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 Great Atlantic Resources are associated (or correlated) with Gossan Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gossan Resources has no effect on the direction of Great Atlantic i.e., Great Atlantic and Gossan Resources go up and down completely randomly.
Pair Corralation between Great Atlantic and Gossan Resources
Given the investment horizon of 90 days Great Atlantic Resources is expected to generate 0.79 times more return on investment than Gossan Resources. However, Great Atlantic Resources is 1.27 times less risky than Gossan Resources. It trades about 0.05 of its potential returns per unit of risk. Gossan Resources is currently generating about 0.01 per unit of risk. If you would invest 6.00 in Great Atlantic Resources on September 1, 2024 and sell it today you would earn a total of 0.50 from holding Great Atlantic Resources or generate 8.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Great Atlantic Resources vs. Gossan Resources
Performance |
| Timeline |
| Great Atlantic Resources |
| Gossan Resources |
Great Atlantic and Gossan Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great Atlantic and Gossan Resources
The main advantage of trading using opposite Great Atlantic and Gossan Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great Atlantic position performs unexpectedly, Gossan 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 Gossan Resources will offset losses from the drop in Gossan Resources' long position.| Great Atlantic vs. Kiplin Metals | Great Atlantic vs. Pure Energy Minerals | Great Atlantic vs. Noram Lithium Corp | Great Atlantic vs. Minnova Corp |
| Gossan Resources vs. Kiplin Metals | Gossan Resources vs. Pure Energy Minerals | Gossan Resources vs. Noram Lithium Corp | Gossan Resources vs. Minnova 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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