Correlation Between Nobel Resources and Troilus Gold

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Can any of the company-specific risk be diversified away by investing in both Nobel Resources and Troilus 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 Nobel Resources and Troilus Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nobel Resources Corp and Troilus Gold Corp, you can compare the effects of market volatilities on Nobel Resources and Troilus 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 Nobel Resources with a short position of Troilus Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nobel Resources and Troilus Gold.

Diversification Opportunities for Nobel Resources and Troilus Gold

NobelTroilusDiversified AwayNobelTroilusDiversified Away100%
-0.25
  Correlation Coefficient

Very good diversification

The 3 months correlation between Nobel and Troilus is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Nobel Resources Corp and Troilus Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Troilus Gold Corp and Nobel Resources 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 Nobel Resources Corp are associated (or correlated) with Troilus Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Troilus Gold Corp has no effect on the direction of Nobel Resources i.e., Nobel Resources and Troilus Gold go up and down completely randomly.

Pair Corralation between Nobel Resources and Troilus Gold

Assuming the 90 days horizon Nobel Resources Corp is expected to under-perform the Troilus Gold. But the pink sheet apears to be less risky and, when comparing its historical volatility, Nobel Resources Corp is 2.37 times less risky than Troilus Gold. The pink sheet trades about -0.15 of its potential returns per unit of risk. The Troilus Gold Corp is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  21.00  in Troilus Gold Corp on November 26, 2024 and sell it today you would earn a total of  3.00  from holding Troilus Gold Corp or generate 14.29% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy92.86%
ValuesDaily Returns

Nobel Resources Corp  vs.  Troilus Gold Corp

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -40-2002040
JavaScript chart by amCharts 3.21.15NBTRF CHXMF
       Timeline  
Nobel Resources Corp 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Nobel Resources Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.0220.0240.0260.0280.030.0320.034
Troilus Gold Corp 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Troilus Gold Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable primary indicators, Troilus Gold is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.180.20.220.240.260.28

Nobel Resources and Troilus Gold Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-8.6-6.44-4.28-2.12-0.0311.83.665.527.399.25 0.01500.01550.01600.01650.0170
JavaScript chart by amCharts 3.21.15NBTRF CHXMF
       Returns  

Pair Trading with Nobel Resources and Troilus Gold

The main advantage of trading using opposite Nobel Resources and Troilus Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nobel Resources position performs unexpectedly, Troilus 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 Troilus Gold will offset losses from the drop in Troilus Gold's long position.
The idea behind Nobel Resources Corp and Troilus Gold Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.

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