Correlation Between Lumina Gold and Kore Mining
Can any of the company-specific risk be diversified away by investing in both Lumina Gold and Kore Mining 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 Lumina Gold and Kore Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lumina Gold Corp and Kore Mining, you can compare the effects of market volatilities on Lumina Gold and Kore Mining 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 Lumina Gold with a short position of Kore Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumina Gold and Kore Mining.
Diversification Opportunities for Lumina Gold and Kore Mining
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lumina and Kore is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Lumina Gold Corp and Kore Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kore Mining and Lumina 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 Lumina Gold Corp are associated (or correlated) with Kore Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kore Mining has no effect on the direction of Lumina Gold i.e., Lumina Gold and Kore Mining go up and down completely randomly.
Pair Corralation between Lumina Gold and Kore Mining
Assuming the 90 days horizon Lumina Gold Corp is expected to under-perform the Kore Mining. But the stock apears to be less risky and, when comparing its historical volatility, Lumina Gold Corp is 3.45 times less risky than Kore Mining. The stock trades about -0.05 of its potential returns per unit of risk. The Kore Mining is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 4.00 in Kore Mining on August 29, 2024 and sell it today you would lose (0.50) from holding Kore Mining or give up 12.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lumina Gold Corp vs. Kore Mining
Performance |
| Timeline |
| Lumina Gold Corp |
| Kore Mining |
Lumina Gold and Kore Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lumina Gold and Kore Mining
The main advantage of trading using opposite Lumina Gold and Kore Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lumina Gold position performs unexpectedly, Kore Mining 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 Kore Mining will offset losses from the drop in Kore Mining's long position.| Lumina Gold vs. Bluestone Resources | Lumina Gold vs. Kore Mining | Lumina Gold vs. Torq Resources | Lumina Gold vs. Regulus Resources |
| Kore Mining vs. Outcrop Gold Corp | Kore Mining vs. Grande Portage Resources | Kore Mining vs. Bluestone Resources | Kore Mining vs. Lumina Gold 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |