Correlation Between Excelsior Mining and Hawkeye Gold
Can any of the company-specific risk be diversified away by investing in both Excelsior Mining and Hawkeye 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 Excelsior Mining and Hawkeye Gold 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 Hawkeye Gold and, you can compare the effects of market volatilities on Excelsior Mining and Hawkeye 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 Excelsior Mining with a short position of Hawkeye Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Excelsior Mining and Hawkeye Gold.
Diversification Opportunities for Excelsior Mining and Hawkeye Gold
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Excelsior and Hawkeye is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Excelsior Mining Corp and Hawkeye Gold and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hawkeye Gold 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 Hawkeye Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hawkeye Gold has no effect on the direction of Excelsior Mining i.e., Excelsior Mining and Hawkeye Gold go up and down completely randomly.
Pair Corralation between Excelsior Mining and Hawkeye Gold
Assuming the 90 days trading horizon Excelsior Mining is expected to generate 4.66 times less return on investment than Hawkeye Gold. But when comparing it to its historical volatility, Excelsior Mining Corp is 1.69 times less risky than Hawkeye Gold. It trades about 0.01 of its potential returns per unit of risk. Hawkeye Gold and is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 6.00 in Hawkeye Gold and on August 30, 2024 and sell it today you would lose (2.00) from holding Hawkeye Gold and or give up 33.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Excelsior Mining Corp vs. Hawkeye Gold and
Performance |
| Timeline |
| Excelsior Mining Corp |
| Hawkeye Gold |
Excelsior Mining and Hawkeye Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Excelsior Mining and Hawkeye Gold
The main advantage of trading using opposite Excelsior Mining and Hawkeye Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Excelsior Mining position performs unexpectedly, Hawkeye 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 Hawkeye Gold will offset losses from the drop in Hawkeye Gold's long position.| Excelsior Mining vs. RTG Mining | Excelsior Mining vs. Nubian Resources | Excelsior Mining vs. Fremont Gold | Excelsior Mining vs. Royal Road Minerals |
| Hawkeye Gold vs. First Majestic Silver | Hawkeye Gold vs. Ivanhoe Energy | Hawkeye Gold vs. Orezone Gold Corp | Hawkeye Gold vs. Faraday Copper 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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