Correlation Between Sable Resources and Eskay Mining
Can any of the company-specific risk be diversified away by investing in both Sable Resources and Eskay Mining 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 Sable Resources and Eskay Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sable Resources and Eskay Mining Corp, you can compare the effects of market volatilities on Sable Resources and Eskay Mining 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 Sable Resources with a short position of Eskay Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sable Resources and Eskay Mining.
Diversification Opportunities for Sable Resources and Eskay Mining
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sable and Eskay is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Sable Resources and Eskay Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eskay Mining Corp and Sable 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 Sable Resources are associated (or correlated) with Eskay Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eskay Mining Corp has no effect on the direction of Sable Resources i.e., Sable Resources and Eskay Mining go up and down completely randomly.
Pair Corralation between Sable Resources and Eskay Mining
Assuming the 90 days horizon Sable Resources is expected to under-perform the Eskay Mining. But the stock apears to be less risky and, when comparing its historical volatility, Sable Resources is 1.22 times less risky than Eskay Mining. The stock trades about -0.03 of its potential returns per unit of risk. The Eskay Mining Corp is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 15.00 in Eskay Mining Corp on September 15, 2024 and sell it today you would earn a total of 4.00 from holding Eskay Mining Corp or generate 26.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Sable Resources vs. Eskay Mining Corp
Performance |
| Timeline |
| Sable Resources |
| Eskay Mining Corp |
Sable Resources and Eskay Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sable Resources and Eskay Mining
The main advantage of trading using opposite Sable Resources and Eskay Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sable Resources position performs unexpectedly, Eskay Mining 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 Eskay Mining will offset losses from the drop in Eskay Mining's long position.| Sable Resources vs. Outcrop Gold Corp | Sable Resources vs. Strikepoint Gold | Sable Resources vs. Defiance Silver Corp | Sable Resources vs. Eskay Mining Corp |
| Eskay Mining vs. Grande Portage Resources | Eskay Mining vs. Strikepoint Gold | Eskay Mining vs. Blackrock Silver Corp | Eskay Mining vs. American Creek 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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