Correlation Between Karora Resources and GFG Resources
Can any of the company-specific risk be diversified away by investing in both Karora Resources and GFG 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 Karora Resources and GFG Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Karora Resources and GFG Resources, you can compare the effects of market volatilities on Karora Resources and GFG 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 Karora Resources with a short position of GFG Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Karora Resources and GFG Resources.
Diversification Opportunities for Karora Resources and GFG Resources
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Karora and GFG is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Karora Resources and GFG Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GFG Resources and Karora Resources 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 Karora Resources are associated (or correlated) with GFG Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GFG Resources has no effect on the direction of Karora Resources i.e., Karora Resources and GFG Resources go up and down completely randomly.
Pair Corralation between Karora Resources and GFG Resources
If you would invest 483.00 in Karora Resources on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Karora Resources or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Karora Resources vs. GFG Resources
Performance |
| Timeline |
| Karora Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| GFG Resources |
Karora Resources and GFG Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Karora Resources and GFG Resources
The main advantage of trading using opposite Karora Resources and GFG Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Karora Resources position performs unexpectedly, GFG 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 GFG Resources will offset losses from the drop in GFG Resources' long position.| Karora Resources vs. K92 Mining | Karora Resources vs. I 80 Gold Corp | Karora Resources vs. Wesdome Gold Mines | Karora Resources vs. GGX Gold Corp |
| GFG Resources vs. Aurion Resources | GFG Resources vs. Rio2 Limited | GFG Resources vs. Palamina Corp | GFG Resources vs. BTU Metals 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 Stocks Directory module to find actively traded stocks across global markets.
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