Correlation Between Seabridge Gold and Contango ORE
Can any of the company-specific risk be diversified away by investing in both Seabridge Gold and Contango ORE 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 Seabridge Gold and Contango ORE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seabridge Gold and Contango ORE, you can compare the effects of market volatilities on Seabridge Gold and Contango ORE 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 Seabridge Gold with a short position of Contango ORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seabridge Gold and Contango ORE.
Diversification Opportunities for Seabridge Gold and Contango ORE
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Seabridge and Contango is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Seabridge Gold and Contango ORE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Contango ORE and Seabridge 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 Seabridge Gold are associated (or correlated) with Contango ORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Contango ORE has no effect on the direction of Seabridge Gold i.e., Seabridge Gold and Contango ORE go up and down completely randomly.
Pair Corralation between Seabridge Gold and Contango ORE
Allowing for the 90-day total investment horizon Seabridge Gold is expected to under-perform the Contango ORE. In addition to that, Seabridge Gold is 1.11 times more volatile than Contango ORE. It trades about -0.41 of its total potential returns per unit of risk. Contango ORE is currently generating about -0.41 per unit of volatility. If you would invest 2,307 in Contango ORE on August 30, 2024 and sell it today you would lose (511.00) from holding Contango ORE or give up 22.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seabridge Gold vs. Contango ORE
Performance |
| Timeline |
| Seabridge Gold |
| Contango ORE |
Seabridge Gold and Contango ORE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seabridge Gold and Contango ORE
The main advantage of trading using opposite Seabridge Gold and Contango ORE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seabridge Gold position performs unexpectedly, Contango ORE 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 Contango ORE will offset losses from the drop in Contango ORE's long position.| Seabridge Gold vs. Franco Nevada | Seabridge Gold vs. Wheaton Precious Metals | Seabridge Gold vs. Osisko Gold Ro | Seabridge Gold vs. Sandstorm Gold Ltd |
| Contango ORE vs. Monarch Mining | Contango ORE vs. First Guaranty Bancshares | Contango ORE vs. Glen Burnie Bancorp | Contango ORE vs. Princeton Capital |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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