Correlation Between US Global and Lion One
Can any of the company-specific risk be diversified away by investing in both US Global and Lion One 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 US Global and Lion One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US Global Investors and Lion One Metals, you can compare the effects of market volatilities on US Global and Lion One 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 US Global with a short position of Lion One. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Global and Lion One.
Diversification Opportunities for US Global and Lion One
Good diversification
The 3 months correlation between GROW and Lion is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding US Global Investors and Lion One Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion One Metals and US Global 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 US Global Investors are associated (or correlated) with Lion One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion One Metals has no effect on the direction of US Global i.e., US Global and Lion One go up and down completely randomly.
Pair Corralation between US Global and Lion One
Given the investment horizon of 90 days US Global Investors is expected to generate 0.52 times more return on investment than Lion One. However, US Global Investors is 1.94 times less risky than Lion One. It trades about -0.03 of its potential returns per unit of risk. Lion One Metals is currently generating about -0.19 per unit of risk. If you would invest 247.00 in US Global Investors on September 2, 2024 and sell it today you would lose (3.00) from holding US Global Investors or give up 1.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
US Global Investors vs. Lion One Metals
Performance |
| Timeline |
| US Global Investors |
| Lion One Metals |
US Global and Lion One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US Global and Lion One
The main advantage of trading using opposite US Global and Lion One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US Global position performs unexpectedly, Lion One 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 Lion One will offset losses from the drop in Lion One's long position.| US Global vs. Gladstone Investment | US Global vs. PennantPark Floating Rate | US Global vs. Horizon Technology Finance | US Global vs. Stellus Capital Investment |
| Lion One vs. Irving Resources | Lion One vs. Headwater Gold | Lion One vs. Novo Resources Corp | Lion One vs. Snowline Gold 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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