Correlation Between Minera Alamos and FireFox Gold
Can any of the company-specific risk be diversified away by investing in both Minera Alamos and FireFox 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 Minera Alamos and FireFox Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Minera Alamos and FireFox Gold Corp, you can compare the effects of market volatilities on Minera Alamos and FireFox 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 Minera Alamos with a short position of FireFox Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Minera Alamos and FireFox Gold.
Diversification Opportunities for Minera Alamos and FireFox Gold
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Minera and FireFox is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Minera Alamos and FireFox Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FireFox Gold Corp and Minera Alamos 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 Minera Alamos are associated (or correlated) with FireFox Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FireFox Gold Corp has no effect on the direction of Minera Alamos i.e., Minera Alamos and FireFox Gold go up and down completely randomly.
Pair Corralation between Minera Alamos and FireFox Gold
Assuming the 90 days horizon Minera Alamos is expected to under-perform the FireFox Gold. But the otc stock apears to be less risky and, when comparing its historical volatility, Minera Alamos is 1.1 times less risky than FireFox Gold. The otc stock trades about -0.18 of its potential returns per unit of risk. The FireFox Gold Corp is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest 3.40 in FireFox Gold Corp on September 1, 2024 and sell it today you would lose (0.65) from holding FireFox Gold Corp or give up 19.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Minera Alamos vs. FireFox Gold Corp
Performance |
| Timeline |
| Minera Alamos |
| FireFox Gold Corp |
Minera Alamos and FireFox Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Minera Alamos and FireFox Gold
The main advantage of trading using opposite Minera Alamos and FireFox Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Minera Alamos position performs unexpectedly, FireFox 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 FireFox Gold will offset losses from the drop in FireFox Gold's long position.| Minera Alamos vs. Aurion Resources | Minera Alamos vs. Minaurum Gold | Minera Alamos vs. Rio2 Limited | Minera Alamos vs. Roscan Gold Corp |
| FireFox Gold vs. Palamina Corp | FireFox Gold vs. Gold Springs Resource | FireFox Gold vs. BTU Metals Corp | FireFox Gold vs. Norsemont Mining |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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