Correlation Between Orefinders Resources and American Eagle
Can any of the company-specific risk be diversified away by investing in both Orefinders Resources and American Eagle 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 Orefinders Resources and American Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orefinders Resources and American Eagle Gold, you can compare the effects of market volatilities on Orefinders Resources and American Eagle 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 Orefinders Resources with a short position of American Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orefinders Resources and American Eagle.
Diversification Opportunities for Orefinders Resources and American Eagle
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Orefinders and American is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Orefinders Resources and American Eagle Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Eagle Gold and Orefinders Resources 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 Orefinders Resources are associated (or correlated) with American Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Eagle Gold has no effect on the direction of Orefinders Resources i.e., Orefinders Resources and American Eagle go up and down completely randomly.
Pair Corralation between Orefinders Resources and American Eagle
Assuming the 90 days horizon Orefinders Resources is expected to generate 1.61 times less return on investment than American Eagle. But when comparing it to its historical volatility, Orefinders Resources is 1.09 times less risky than American Eagle. It trades about 0.07 of its potential returns per unit of risk. American Eagle Gold is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 15.00 in American Eagle Gold on September 1, 2024 and sell it today you would earn a total of 52.00 from holding American Eagle Gold or generate 346.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orefinders Resources vs. American Eagle Gold
Performance |
| Timeline |
| Orefinders Resources |
| American Eagle Gold |
Orefinders Resources and American Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orefinders Resources and American Eagle
The main advantage of trading using opposite Orefinders Resources and American Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orefinders Resources position performs unexpectedly, American Eagle 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 American Eagle will offset losses from the drop in American Eagle's long position.| Orefinders Resources vs. Aurion Resources | Orefinders Resources vs. Rio2 Limited | Orefinders Resources vs. Palamina Corp | Orefinders Resources vs. BTU Metals Corp |
| American Eagle vs. Minnova Corp | American Eagle vs. Blue Star Gold | American Eagle vs. Advance Gold Corp | American Eagle vs. Argo Gold |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |