Correlation Between Puma Exploration and Golden Star
Can any of the company-specific risk be diversified away by investing in both Puma Exploration and Golden Star 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 Puma Exploration and Golden Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Puma Exploration and Golden Star Resource, you can compare the effects of market volatilities on Puma Exploration and Golden Star 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 Puma Exploration with a short position of Golden Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Puma Exploration and Golden Star.
Diversification Opportunities for Puma Exploration and Golden Star
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Puma and Golden is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Puma Exploration and Golden Star Resource in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Star Resource and Puma Exploration 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 Puma Exploration are associated (or correlated) with Golden Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Star Resource has no effect on the direction of Puma Exploration i.e., Puma Exploration and Golden Star go up and down completely randomly.
Pair Corralation between Puma Exploration and Golden Star
Assuming the 90 days horizon Puma Exploration is expected to generate 14.03 times less return on investment than Golden Star. But when comparing it to its historical volatility, Puma Exploration is 1.8 times less risky than Golden Star. It trades about 0.0 of its potential returns per unit of risk. Golden Star Resource is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 103.00 in Golden Star Resource on November 19, 2024 and sell it today you would lose (28.00) from holding Golden Star Resource or give up 27.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
Puma Exploration vs. Golden Star Resource
Performance |
| Timeline |
| Puma Exploration |
| Golden Star Resource |
Puma Exploration and Golden Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Puma Exploration and Golden Star
The main advantage of trading using opposite Puma Exploration and Golden Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Puma Exploration position performs unexpectedly, Golden Star 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 Star will offset losses from the drop in Golden Star's long position.| Puma Exploration vs. Sixty North Gold | Puma Exploration vs. Red Pine Exploration | Puma Exploration vs. Grande Portage Resources | Puma Exploration vs. Altamira Gold Corp |
| Golden Star vs. Alto Neuroscience, | Golden Star vs. Western Digital | Golden Star vs. NETGEAR | Golden Star vs. Weibo 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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