Correlation Between Lion One and Snowline Gold
Can any of the company-specific risk be diversified away by investing in both Lion One and Snowline Gold 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 Lion One and Snowline Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lion One Metals and Snowline Gold Corp, you can compare the effects of market volatilities on Lion One and Snowline Gold 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 Lion One with a short position of Snowline Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion One and Snowline Gold.
Diversification Opportunities for Lion One and Snowline Gold
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lion and Snowline is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Lion One Metals and Snowline Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Snowline Gold Corp and Lion One 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 Lion One Metals are associated (or correlated) with Snowline Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Snowline Gold Corp has no effect on the direction of Lion One i.e., Lion One and Snowline Gold go up and down completely randomly.
Pair Corralation between Lion One and Snowline Gold
Assuming the 90 days horizon Lion One Metals is expected to generate 3.08 times more return on investment than Snowline Gold. However, Lion One is 3.08 times more volatile than Snowline Gold Corp. It trades about 0.26 of its potential returns per unit of risk. Snowline Gold Corp is currently generating about 0.04 per unit of risk. If you would invest 28.00 in Lion One Metals on November 3, 2024 and sell it today you would earn a total of 10.00 from holding Lion One Metals or generate 35.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lion One Metals vs. Snowline Gold Corp
Performance |
| Timeline |
| Lion One Metals |
| Snowline Gold Corp |
Lion One and Snowline Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lion One and Snowline Gold
The main advantage of trading using opposite Lion One and Snowline Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion One position performs unexpectedly, Snowline Gold 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 Snowline Gold will offset losses from the drop in Snowline Gold's long position.The idea behind Lion One Metals and Snowline Gold Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Snowline Gold vs. Slate Grocery REIT | Snowline Gold vs. Mako Mining Corp | Snowline Gold vs. Thunderbird Entertainment Group | Snowline Gold vs. TGS Esports |
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
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |