Correlation Between St Augustine and Black Widow
Can any of the company-specific risk be diversified away by investing in both St Augustine and Black Widow 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 St Augustine and Black Widow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between St Augustine Gold and Black Widow Resources, you can compare the effects of market volatilities on St Augustine and Black Widow 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 St Augustine with a short position of Black Widow. Check out your portfolio center. Please also check ongoing floating volatility patterns of St Augustine and Black Widow.
Diversification Opportunities for St Augustine and Black Widow
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SAU and Black is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding St Augustine Gold and Black Widow Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Black Widow Resources and St Augustine 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 St Augustine Gold are associated (or correlated) with Black Widow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Black Widow Resources has no effect on the direction of St Augustine i.e., St Augustine and Black Widow go up and down completely randomly.
Pair Corralation between St Augustine and Black Widow
Assuming the 90 days trading horizon St Augustine Gold is expected to generate 0.68 times more return on investment than Black Widow. However, St Augustine Gold is 1.46 times less risky than Black Widow. It trades about 0.02 of its potential returns per unit of risk. Black Widow Resources is currently generating about -0.21 per unit of risk. If you would invest 8.00 in St Augustine Gold on August 25, 2024 and sell it today you would earn a total of 0.00 from holding St Augustine Gold or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
St Augustine Gold vs. Black Widow Resources
Performance |
| Timeline |
| St Augustine Gold |
| Black Widow Resources |
St Augustine and Black Widow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with St Augustine and Black Widow
The main advantage of trading using opposite St Augustine and Black Widow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if St Augustine position performs unexpectedly, Black Widow 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 Black Widow will offset losses from the drop in Black Widow's long position.| St Augustine vs. Northcliff Resources | St Augustine vs. Lupaka Gold Corp | St Augustine vs. Angkor Resources Corp | St Augustine vs. Minco Capital Corp |
| Black Widow vs. First Majestic Silver | Black Widow vs. Ivanhoe Energy | Black Widow vs. Orezone Gold Corp | Black Widow vs. Faraday Copper 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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