Correlation Between Prosper Gold and Stampede Drilling
Can any of the company-specific risk be diversified away by investing in both Prosper Gold and Stampede Drilling 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 Prosper Gold and Stampede Drilling into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prosper Gold Corp and Stampede Drilling, you can compare the effects of market volatilities on Prosper Gold and Stampede Drilling 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 Prosper Gold with a short position of Stampede Drilling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prosper Gold and Stampede Drilling.
Diversification Opportunities for Prosper Gold and Stampede Drilling
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Prosper and Stampede is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Prosper Gold Corp and Stampede Drilling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stampede Drilling and Prosper 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 Prosper Gold Corp are associated (or correlated) with Stampede Drilling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stampede Drilling has no effect on the direction of Prosper Gold i.e., Prosper Gold and Stampede Drilling go up and down completely randomly.
Pair Corralation between Prosper Gold and Stampede Drilling
Assuming the 90 days horizon Prosper Gold Corp is expected to under-perform the Stampede Drilling. But the stock apears to be less risky and, when comparing its historical volatility, Prosper Gold Corp is 3.08 times less risky than Stampede Drilling. The stock trades about -0.21 of its potential returns per unit of risk. The Stampede Drilling is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 20.00 in Stampede Drilling on September 13, 2024 and sell it today you would lose (1.00) from holding Stampede Drilling or give up 5.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prosper Gold Corp vs. Stampede Drilling
Performance |
| Timeline |
| Prosper Gold Corp |
| Stampede Drilling |
Prosper Gold and Stampede Drilling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prosper Gold and Stampede Drilling
The main advantage of trading using opposite Prosper Gold and Stampede Drilling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prosper Gold position performs unexpectedly, Stampede Drilling 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 Stampede Drilling will offset losses from the drop in Stampede Drilling's long position.| Prosper Gold vs. Canadian Imperial Bank | Prosper Gold vs. TGS Esports | Prosper Gold vs. Rogers Communications | Prosper Gold vs. Everyday People Financial |
| Stampede Drilling vs. Trican Well Service | Stampede Drilling vs. Ensign Energy Services | Stampede Drilling vs. Calfrac Well Services | Stampede Drilling vs. Birchcliff Energy |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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