Correlation Between Orezone Gold and Infinico Metals
Can any of the company-specific risk be diversified away by investing in both Orezone Gold and Infinico Metals 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 Infinico Metals 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 Infinico Metals Corp, you can compare the effects of market volatilities on Orezone Gold and Infinico Metals 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 Infinico Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orezone Gold and Infinico Metals.
Diversification Opportunities for Orezone Gold and Infinico Metals
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Orezone and Infinico is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Orezone Gold Corp and Infinico Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infinico Metals Corp 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 Infinico Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infinico Metals Corp has no effect on the direction of Orezone Gold i.e., Orezone Gold and Infinico Metals go up and down completely randomly.
Pair Corralation between Orezone Gold and Infinico Metals
Assuming the 90 days trading horizon Orezone Gold Corp is expected to under-perform the Infinico Metals. But the stock apears to be less risky and, when comparing its historical volatility, Orezone Gold Corp is 3.15 times less risky than Infinico Metals. The stock trades about -0.37 of its potential returns per unit of risk. The Infinico Metals Corp is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 2.50 in Infinico Metals Corp on August 25, 2024 and sell it today you would lose (0.50) from holding Infinico Metals Corp or give up 20.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orezone Gold Corp vs. Infinico Metals Corp
Performance |
| Timeline |
| Orezone Gold Corp |
| Infinico Metals Corp |
Orezone Gold and Infinico Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orezone Gold and Infinico Metals
The main advantage of trading using opposite Orezone Gold and Infinico Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orezone Gold position performs unexpectedly, Infinico Metals 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 Infinico Metals will offset losses from the drop in Infinico Metals' long position.| Orezone Gold vs. i 80 Gold Corp | Orezone Gold vs. Perseus Mining | Orezone Gold vs. K92 Mining | Orezone Gold vs. GoGold Resources |
| Infinico Metals vs. First Majestic Silver | Infinico Metals vs. Ivanhoe Energy | Infinico Metals vs. Orezone Gold Corp | Infinico Metals vs. Faraday Copper 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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