Correlation Between K92 Mining and Gold Reserve
Can any of the company-specific risk be diversified away by investing in both K92 Mining and Gold Reserve 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 K92 Mining and Gold Reserve into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between K92 Mining and Gold Reserve, you can compare the effects of market volatilities on K92 Mining and Gold Reserve 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 K92 Mining with a short position of Gold Reserve. Check out your portfolio center. Please also check ongoing floating volatility patterns of K92 Mining and Gold Reserve.
Diversification Opportunities for K92 Mining and Gold Reserve
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between K92 and Gold is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding K92 Mining and Gold Reserve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Reserve and K92 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 K92 Mining are associated (or correlated) with Gold Reserve. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Reserve has no effect on the direction of K92 Mining i.e., K92 Mining and Gold Reserve go up and down completely randomly.
Pair Corralation between K92 Mining and Gold Reserve
Assuming the 90 days horizon K92 Mining is expected to generate 0.28 times more return on investment than Gold Reserve. However, K92 Mining is 3.57 times less risky than Gold Reserve. It trades about -0.1 of its potential returns per unit of risk. Gold Reserve is currently generating about -0.16 per unit of risk. If you would invest 687.00 in K92 Mining on August 30, 2024 and sell it today you would lose (43.00) from holding K92 Mining or give up 6.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
K92 Mining vs. Gold Reserve
Performance |
| Timeline |
| K92 Mining |
| Gold Reserve |
K92 Mining and Gold Reserve Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with K92 Mining and Gold Reserve
The main advantage of trading using opposite K92 Mining and Gold Reserve positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if K92 Mining position performs unexpectedly, Gold Reserve 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 Gold Reserve will offset losses from the drop in Gold Reserve's long position.| K92 Mining vs. I 80 Gold Corp | K92 Mining vs. Equinox Gold Corp | K92 Mining vs. Contango ORE | K92 Mining vs. Orla Mining |
| Gold Reserve vs. Monarch Mining | Gold Reserve vs. Lundin Gold | Gold Reserve vs. Liberty Gold Corp | Gold Reserve vs. Minera Alamos |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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