Correlation Between Excelsior Mining and Greenfire Resources
Can any of the company-specific risk be diversified away by investing in both Excelsior Mining and Greenfire 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 Excelsior Mining and Greenfire Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Excelsior Mining Corp and Greenfire Resources, you can compare the effects of market volatilities on Excelsior Mining and Greenfire 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 Excelsior Mining with a short position of Greenfire Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Excelsior Mining and Greenfire Resources.
Diversification Opportunities for Excelsior Mining and Greenfire Resources
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Excelsior and Greenfire is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Excelsior Mining Corp and Greenfire Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenfire Resources and Excelsior Mining 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 Excelsior Mining Corp are associated (or correlated) with Greenfire Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenfire Resources has no effect on the direction of Excelsior Mining i.e., Excelsior Mining and Greenfire Resources go up and down completely randomly.
Pair Corralation between Excelsior Mining and Greenfire Resources
Assuming the 90 days trading horizon Excelsior Mining Corp is expected to generate 4.06 times more return on investment than Greenfire Resources. However, Excelsior Mining is 4.06 times more volatile than Greenfire Resources. It trades about 0.08 of its potential returns per unit of risk. Greenfire Resources is currently generating about -0.02 per unit of risk. If you would invest 19.00 in Excelsior Mining Corp on October 25, 2024 and sell it today you would earn a total of 1.00 from holding Excelsior Mining Corp or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 78.95% |
| Values | Daily Returns |
Excelsior Mining Corp vs. Greenfire Resources
Performance |
| Timeline |
| Excelsior Mining Corp |
| Greenfire Resources |
Excelsior Mining and Greenfire Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Excelsior Mining and Greenfire Resources
The main advantage of trading using opposite Excelsior Mining and Greenfire Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Excelsior Mining position performs unexpectedly, Greenfire 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 Greenfire Resources will offset losses from the drop in Greenfire Resources' long position.| Excelsior Mining vs. RTG Mining | Excelsior Mining vs. Nubian Resources | Excelsior Mining vs. Royal Road Minerals |
| Greenfire Resources vs. Osisko Metals | Greenfire Resources vs. Ramp Metals | Greenfire Resources vs. Toronto Dominion Bank | Greenfire Resources vs. Pollard Banknote Limited |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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