Correlation Between Orezone Gold and Golden Arrow
Can any of the company-specific risk be diversified away by investing in both Orezone Gold and Golden Arrow 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 Orezone Gold and Golden Arrow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orezone Gold Corp and Golden Arrow Resources, you can compare the effects of market volatilities on Orezone Gold and Golden Arrow 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 Orezone Gold with a short position of Golden Arrow. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orezone Gold and Golden Arrow.
Diversification Opportunities for Orezone Gold and Golden Arrow
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Orezone and Golden is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Orezone Gold Corp and Golden Arrow Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Arrow Resources and Orezone 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 Orezone Gold Corp are associated (or correlated) with Golden Arrow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Arrow Resources has no effect on the direction of Orezone Gold i.e., Orezone Gold and Golden Arrow go up and down completely randomly.
Pair Corralation between Orezone Gold and Golden Arrow
Assuming the 90 days trading horizon Orezone Gold is expected to generate 1.51 times less return on investment than Golden Arrow. But when comparing it to its historical volatility, Orezone Gold Corp is 1.7 times less risky than Golden Arrow. It trades about 0.02 of its potential returns per unit of risk. Golden Arrow Resources is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 6.00 in Golden Arrow Resources on September 1, 2024 and sell it today you would lose (1.00) from holding Golden Arrow Resources or give up 16.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Orezone Gold Corp vs. Golden Arrow Resources
Performance |
| Timeline |
| Orezone Gold Corp |
| Golden Arrow Resources |
Orezone Gold and Golden Arrow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orezone Gold and Golden Arrow
The main advantage of trading using opposite Orezone Gold and Golden Arrow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orezone Gold position performs unexpectedly, Golden Arrow 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 Golden Arrow will offset losses from the drop in Golden Arrow's long position.| Orezone Gold vs. i 80 Gold Corp | Orezone Gold vs. Perseus Mining | Orezone Gold vs. K92 Mining | Orezone Gold vs. GoGold Resources |
| Golden Arrow vs. Kiplin Metals | Golden Arrow vs. Pure Energy Minerals | Golden Arrow vs. Noram Lithium Corp | Golden Arrow vs. Minnova Corp |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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