Correlation Between Hecla Mining and GoGold Resources
Can any of the company-specific risk be diversified away by investing in both Hecla Mining and GoGold 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 Hecla Mining and GoGold Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hecla Mining and GoGold Resources, you can compare the effects of market volatilities on Hecla Mining and GoGold 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 Hecla Mining with a short position of GoGold Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hecla Mining and GoGold Resources.
Diversification Opportunities for Hecla Mining and GoGold Resources
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hecla and GoGold is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Hecla Mining and GoGold Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GoGold Resources and Hecla Mining 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 Hecla Mining are associated (or correlated) with GoGold Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GoGold Resources has no effect on the direction of Hecla Mining i.e., Hecla Mining and GoGold Resources go up and down completely randomly.
Pair Corralation between Hecla Mining and GoGold Resources
Allowing for the 90-day total investment horizon Hecla Mining is expected to generate 2.64 times less return on investment than GoGold Resources. But when comparing it to its historical volatility, Hecla Mining is 1.28 times less risky than GoGold Resources. It trades about 0.04 of its potential returns per unit of risk. GoGold Resources is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 82.00 in GoGold Resources on November 2, 2024 and sell it today you would earn a total of 22.00 from holding GoGold Resources or generate 26.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hecla Mining vs. GoGold Resources
Performance |
| Timeline |
| Hecla Mining |
| GoGold Resources |
Hecla Mining and GoGold Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hecla Mining and GoGold Resources
The main advantage of trading using opposite Hecla Mining and GoGold Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hecla Mining position performs unexpectedly, GoGold 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 GoGold Resources will offset losses from the drop in GoGold Resources' long position.| Hecla Mining vs. SilverCrest Metals | Hecla Mining vs. McEwen Mining | Hecla Mining vs. Avino Silver Gold | Hecla Mining vs. Metalla Royalty Streaming |
| GoGold Resources vs. Regenx Tech Corp | GoGold Resources vs. P2 Gold | GoGold Resources vs. Max Resource Corp | GoGold Resources vs. Pacific Ridge Exploration |
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 CEOs Directory module to screen CEOs from public companies around the world.
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