Correlation Between O3 Mining and Montage Gold
Can any of the company-specific risk be diversified away by investing in both O3 Mining and Montage 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 O3 Mining and Montage Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between O3 Mining and Montage Gold Corp, you can compare the effects of market volatilities on O3 Mining and Montage 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 O3 Mining with a short position of Montage Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of O3 Mining and Montage Gold.
Diversification Opportunities for O3 Mining and Montage Gold
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between OIII and Montage is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding O3 Mining and Montage Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Montage Gold Corp and O3 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 O3 Mining are associated (or correlated) with Montage Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Montage Gold Corp has no effect on the direction of O3 Mining i.e., O3 Mining and Montage Gold go up and down completely randomly.
Pair Corralation between O3 Mining and Montage Gold
Assuming the 90 days trading horizon O3 Mining is expected to generate 2.72 times less return on investment than Montage Gold. In addition to that, O3 Mining is 1.06 times more volatile than Montage Gold Corp. It trades about 0.05 of its total potential returns per unit of risk. Montage Gold Corp is currently generating about 0.14 per unit of volatility. If you would invest 177.00 in Montage Gold Corp on September 2, 2024 and sell it today you would earn a total of 46.00 from holding Montage Gold Corp or generate 25.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
O3 Mining vs. Montage Gold Corp
Performance |
| Timeline |
| O3 Mining |
| Montage Gold Corp |
O3 Mining and Montage Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with O3 Mining and Montage Gold
The main advantage of trading using opposite O3 Mining and Montage Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if O3 Mining position performs unexpectedly, Montage 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 Montage Gold will offset losses from the drop in Montage Gold's long position.| O3 Mining vs. Integra Resources Corp | O3 Mining vs. Troilus Gold Corp | O3 Mining vs. Cartier Resources | O3 Mining vs. Bluestone Resources |
| Montage Gold vs. Newcore Gold | Montage Gold vs. Revival Gold | Montage Gold vs. Integra Resources Corp | Montage Gold vs. Lion One 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |