Correlation Between Metalla Royalty and Equinox Gold
Can any of the company-specific risk be diversified away by investing in both Metalla Royalty and Equinox 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 Metalla Royalty and Equinox Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metalla Royalty Streaming and Equinox Gold Corp, you can compare the effects of market volatilities on Metalla Royalty and Equinox 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 Metalla Royalty with a short position of Equinox Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metalla Royalty and Equinox Gold.
Diversification Opportunities for Metalla Royalty and Equinox Gold
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Metalla and Equinox is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Metalla Royalty Streaming and Equinox Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equinox Gold Corp and Metalla Royalty 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 Metalla Royalty Streaming are associated (or correlated) with Equinox Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equinox Gold Corp has no effect on the direction of Metalla Royalty i.e., Metalla Royalty and Equinox Gold go up and down completely randomly.
Pair Corralation between Metalla Royalty and Equinox Gold
Assuming the 90 days horizon Metalla Royalty Streaming is expected to under-perform the Equinox Gold. But the stock apears to be less risky and, when comparing its historical volatility, Metalla Royalty Streaming is 1.02 times less risky than Equinox Gold. The stock trades about -0.23 of its potential returns per unit of risk. The Equinox Gold Corp is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 813.00 in Equinox Gold Corp on August 30, 2024 and sell it today you would lose (27.00) from holding Equinox Gold Corp or give up 3.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metalla Royalty Streaming vs. Equinox Gold Corp
Performance |
| Timeline |
| Metalla Royalty Streaming |
| Equinox Gold Corp |
Metalla Royalty and Equinox Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metalla Royalty and Equinox Gold
The main advantage of trading using opposite Metalla Royalty and Equinox Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metalla Royalty position performs unexpectedly, Equinox 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 Equinox Gold will offset losses from the drop in Equinox Gold's long position.| Metalla Royalty vs. First Majestic Silver | Metalla Royalty vs. Ivanhoe Energy | Metalla Royalty vs. Orezone Gold Corp | Metalla Royalty vs. Faraday Copper Corp |
| Equinox Gold vs. Sandstorm Gold Ltd | Equinox Gold vs. Pan American Silver | Equinox Gold vs. SSR Mining | Equinox Gold vs. SilverCrest Metals |
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 Stocks Directory module to find actively traded stocks across global markets.
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