Correlation Between Lion One and GGX Gold
Can any of the company-specific risk be diversified away by investing in both Lion One and GGX 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 GGX 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 GGX Gold Corp, you can compare the effects of market volatilities on Lion One and GGX 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 GGX Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion One and GGX Gold.
Diversification Opportunities for Lion One and GGX Gold
Modest diversification
The 3 months correlation between Lion and GGX is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Lion One Metals and GGX Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GGX 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 GGX Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GGX Gold Corp has no effect on the direction of Lion One i.e., Lion One and GGX Gold go up and down completely randomly.
Pair Corralation between Lion One and GGX Gold
Assuming the 90 days horizon Lion One Metals is expected to under-perform the GGX Gold. But the otc stock apears to be less risky and, when comparing its historical volatility, Lion One Metals is 3.25 times less risky than GGX Gold. The otc stock trades about -0.05 of its potential returns per unit of risk. The GGX Gold Corp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1.74 in GGX Gold Corp on September 1, 2024 and sell it today you would lose (0.49) from holding GGX Gold Corp or give up 28.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.47% |
| Values | Daily Returns |
Lion One Metals vs. GGX Gold Corp
Performance |
| Timeline |
| Lion One Metals |
| GGX Gold Corp |
Lion One and GGX Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lion One and GGX Gold
The main advantage of trading using opposite Lion One and GGX Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion One position performs unexpectedly, GGX 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 GGX Gold will offset losses from the drop in GGX Gold's long position.| Lion One vs. Irving Resources | Lion One vs. Headwater Gold | Lion One vs. Novo Resources Corp | Lion One vs. Snowline Gold Corp |
| GGX Gold vs. Aurion Resources | GGX Gold vs. Rio2 Limited | GGX Gold vs. Palamina Corp | GGX Gold 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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