Correlation Between Robex Resources and GFG Resources
Can any of the company-specific risk be diversified away by investing in both Robex Resources and GFG Resources 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 Robex Resources and GFG Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Robex Resources and GFG Resources, you can compare the effects of market volatilities on Robex Resources and GFG Resources 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 Robex Resources with a short position of GFG Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Robex Resources and GFG Resources.
Diversification Opportunities for Robex Resources and GFG Resources
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Robex and GFG is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Robex Resources and GFG Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GFG Resources and Robex 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 Robex Resources are associated (or correlated) with GFG Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GFG Resources has no effect on the direction of Robex Resources i.e., Robex Resources and GFG Resources go up and down completely randomly.
Pair Corralation between Robex Resources and GFG Resources
Assuming the 90 days horizon Robex Resources is expected to under-perform the GFG Resources. But the pink sheet apears to be less risky and, when comparing its historical volatility, Robex Resources is 3.4 times less risky than GFG Resources. The pink sheet trades about -0.16 of its potential returns per unit of risk. The GFG Resources is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 9.67 in GFG Resources on August 25, 2024 and sell it today you would earn a total of 1.33 from holding GFG Resources or generate 13.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Robex Resources vs. GFG Resources
Performance |
| Timeline |
| Robex Resources |
| GFG Resources |
Robex Resources and GFG Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Robex Resources and GFG Resources
The main advantage of trading using opposite Robex Resources and GFG Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Robex Resources position performs unexpectedly, GFG Resources 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 GFG Resources will offset losses from the drop in GFG Resources' long position.| Robex Resources vs. Ascendant Resources | Robex Resources vs. Cantex Mine Development | Robex Resources vs. Amarc Resources | Robex Resources vs. Sterling Metals Corp |
| GFG Resources vs. Japan Gold Corp | GFG Resources vs. Robex Resources | GFG Resources vs. Rover Metals Corp | GFG Resources vs. Orefinders Resources |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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