Correlation Between Labrador Gold and Magna Gold
Can any of the company-specific risk be diversified away by investing in both Labrador Gold and Magna 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 Labrador Gold and Magna Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Labrador Gold Corp and Magna Gold Corp, you can compare the effects of market volatilities on Labrador Gold and Magna 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 Labrador Gold with a short position of Magna Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Labrador Gold and Magna Gold.
Diversification Opportunities for Labrador Gold and Magna Gold
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Labrador and Magna is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Labrador Gold Corp and Magna Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magna Gold Corp and Labrador Gold 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 Labrador Gold Corp are associated (or correlated) with Magna Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magna Gold Corp has no effect on the direction of Labrador Gold i.e., Labrador Gold and Magna Gold go up and down completely randomly.
Pair Corralation between Labrador Gold and Magna Gold
Assuming the 90 days horizon Labrador Gold Corp is expected to under-perform the Magna Gold. But the otc stock apears to be less risky and, when comparing its historical volatility, Labrador Gold Corp is 2.09 times less risky than Magna Gold. The otc stock trades about -0.02 of its potential returns per unit of risk. The Magna Gold Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 3.00 in Magna Gold Corp on August 26, 2024 and sell it today you would lose (2.20) from holding Magna Gold Corp or give up 73.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 31.99% |
| Values | Daily Returns |
Labrador Gold Corp vs. Magna Gold Corp
Performance |
| Timeline |
| Labrador Gold Corp |
| Magna Gold Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Labrador Gold and Magna Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Labrador Gold and Magna Gold
The main advantage of trading using opposite Labrador Gold and Magna Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Labrador Gold position performs unexpectedly, Magna 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 Magna Gold will offset losses from the drop in Magna Gold's long position.| Labrador Gold vs. Exploits Discovery Corp | Labrador Gold vs. Mako Mining Corp | Labrador Gold vs. Puma Exploration | Labrador Gold vs. Aurion Resources |
| Magna Gold vs. Robex Resources | Magna Gold vs. Rover Metals Corp | Magna Gold vs. Eloro Resources | Magna Gold vs. Orefinders Resources |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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