Correlation Between Klondike Gold and Exploits Discovery
Can any of the company-specific risk be diversified away by investing in both Klondike Gold and Exploits Discovery 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 Klondike Gold and Exploits Discovery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Klondike Gold Corp and Exploits Discovery Corp, you can compare the effects of market volatilities on Klondike Gold and Exploits Discovery 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 Klondike Gold with a short position of Exploits Discovery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Klondike Gold and Exploits Discovery.
Diversification Opportunities for Klondike Gold and Exploits Discovery
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Klondike and Exploits is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Klondike Gold Corp and Exploits Discovery Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exploits Discovery Corp and Klondike Gold 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 Klondike Gold Corp are associated (or correlated) with Exploits Discovery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exploits Discovery Corp has no effect on the direction of Klondike Gold i.e., Klondike Gold and Exploits Discovery go up and down completely randomly.
Pair Corralation between Klondike Gold and Exploits Discovery
Assuming the 90 days horizon Klondike Gold Corp is expected to generate 1.1 times more return on investment than Exploits Discovery. However, Klondike Gold is 1.1 times more volatile than Exploits Discovery Corp. It trades about -0.08 of its potential returns per unit of risk. Exploits Discovery Corp is currently generating about -0.24 per unit of risk. If you would invest 6.00 in Klondike Gold Corp on August 30, 2024 and sell it today you would lose (1.00) from holding Klondike Gold Corp or give up 16.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Klondike Gold Corp vs. Exploits Discovery Corp
Performance |
| Timeline |
| Klondike Gold Corp |
| Exploits Discovery Corp |
Klondike Gold and Exploits Discovery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Klondike Gold and Exploits Discovery
The main advantage of trading using opposite Klondike Gold and Exploits Discovery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Klondike Gold position performs unexpectedly, Exploits Discovery 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 Exploits Discovery will offset losses from the drop in Exploits Discovery's long position.| Klondike Gold vs. Vertiv Holdings Co | Klondike Gold vs. Nasdaq Inc | Klondike Gold vs. McDonalds | Klondike Gold vs. Walmart |
| Exploits Discovery vs. Vertiv Holdings Co | Exploits Discovery vs. Nasdaq Inc | Exploits Discovery vs. McDonalds | Exploits Discovery vs. Walmart |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |