Correlation Between Skeena Resources and Orla Mining
Can any of the company-specific risk be diversified away by investing in both Skeena Resources and Orla 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 Skeena Resources and Orla Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Skeena Resources and Orla Mining, you can compare the effects of market volatilities on Skeena Resources and Orla 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 Skeena Resources with a short position of Orla Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Skeena Resources and Orla Mining.
Diversification Opportunities for Skeena Resources and Orla Mining
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Skeena and Orla is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Skeena Resources and Orla Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orla Mining and Skeena 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 Skeena Resources are associated (or correlated) with Orla Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orla Mining has no effect on the direction of Skeena Resources i.e., Skeena Resources and Orla Mining go up and down completely randomly.
Pair Corralation between Skeena Resources and Orla Mining
Assuming the 90 days trading horizon Skeena Resources is expected to generate 10.77 times less return on investment than Orla Mining. But when comparing it to its historical volatility, Skeena Resources is 1.03 times less risky than Orla Mining. It trades about 0.0 of its potential returns per unit of risk. Orla Mining is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 663.00 in Orla Mining on September 2, 2024 and sell it today you would earn a total of 15.00 from holding Orla Mining or generate 2.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Skeena Resources vs. Orla Mining
Performance |
| Timeline |
| Skeena Resources |
| Orla Mining |
Skeena Resources and Orla Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Skeena Resources and Orla Mining
The main advantage of trading using opposite Skeena Resources and Orla Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Skeena Resources position performs unexpectedly, Orla 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 Orla Mining will offset losses from the drop in Orla Mining's long position.| Skeena Resources vs. Kiplin Metals | Skeena Resources vs. Noram Lithium Corp | Skeena Resources vs. Minnova 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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