Correlation Between Outcrop Gold and Bluestone Resources
Can any of the company-specific risk be diversified away by investing in both Outcrop Gold and Bluestone 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 Outcrop Gold and Bluestone Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Outcrop Gold Corp and Bluestone Resources, you can compare the effects of market volatilities on Outcrop Gold and Bluestone 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 Outcrop Gold with a short position of Bluestone Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Outcrop Gold and Bluestone Resources.
Diversification Opportunities for Outcrop Gold and Bluestone Resources
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Outcrop and Bluestone is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Outcrop Gold Corp and Bluestone Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bluestone Resources and Outcrop 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 Outcrop Gold Corp are associated (or correlated) with Bluestone Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bluestone Resources has no effect on the direction of Outcrop Gold i.e., Outcrop Gold and Bluestone Resources go up and down completely randomly.
Pair Corralation between Outcrop Gold and Bluestone Resources
Assuming the 90 days horizon Outcrop Gold Corp is expected to under-perform the Bluestone Resources. In addition to that, Outcrop Gold is 2.41 times more volatile than Bluestone Resources. It trades about -0.07 of its total potential returns per unit of risk. Bluestone Resources is currently generating about 0.01 per unit of volatility. If you would invest 30.00 in Bluestone Resources on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Bluestone Resources or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Outcrop Gold Corp vs. Bluestone Resources
Performance |
| Timeline |
| Outcrop Gold Corp |
| Bluestone Resources |
Outcrop Gold and Bluestone Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Outcrop Gold and Bluestone Resources
The main advantage of trading using opposite Outcrop Gold and Bluestone Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Outcrop Gold position performs unexpectedly, Bluestone 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 Bluestone Resources will offset losses from the drop in Bluestone Resources' long position.| Outcrop Gold vs. Strikepoint Gold | Outcrop Gold vs. Kootenay Silver | Outcrop Gold vs. Kore Mining | Outcrop Gold vs. Blackrock Silver Corp |
| Bluestone Resources vs. Kore Mining | Bluestone Resources vs. Lumina Gold Corp | Bluestone Resources vs. Triumph Gold Corp | Bluestone Resources vs. Westhaven Ventures |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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