Correlation Between Snowline Gold and Independence Gold
Can any of the company-specific risk be diversified away by investing in both Snowline Gold and Independence Gold 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 Snowline Gold and Independence Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snowline Gold Corp and Independence Gold Corp, you can compare the effects of market volatilities on Snowline Gold and Independence Gold 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 Snowline Gold with a short position of Independence Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snowline Gold and Independence Gold.
Diversification Opportunities for Snowline Gold and Independence Gold
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Snowline and Independence is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Snowline Gold Corp and Independence Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Independence Gold Corp and Snowline 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 Snowline Gold Corp are associated (or correlated) with Independence Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Independence Gold Corp has no effect on the direction of Snowline Gold i.e., Snowline Gold and Independence Gold go up and down completely randomly.
Pair Corralation between Snowline Gold and Independence Gold
Assuming the 90 days horizon Snowline Gold Corp is expected to generate 0.39 times more return on investment than Independence Gold. However, Snowline Gold Corp is 2.59 times less risky than Independence Gold. It trades about 0.17 of its potential returns per unit of risk. Independence Gold Corp is currently generating about 0.02 per unit of risk. If you would invest 350.00 in Snowline Gold Corp on October 23, 2024 and sell it today you would earn a total of 20.00 from holding Snowline Gold Corp or generate 5.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Snowline Gold Corp vs. Independence Gold Corp
Performance |
| Timeline |
| Snowline Gold Corp |
| Independence Gold Corp |
Snowline Gold and Independence Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snowline Gold and Independence Gold
The main advantage of trading using opposite Snowline Gold and Independence Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snowline Gold position performs unexpectedly, Independence Gold 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 Independence Gold will offset losses from the drop in Independence Gold's long position.| Snowline Gold vs. Heliostar Metals | Snowline Gold vs. Independence Gold Corp | Snowline Gold vs. Westward Gold | Snowline Gold vs. Cabral Gold |
| Independence Gold vs. Heliostar Metals | Independence Gold vs. Revival Gold | Independence Gold vs. Cabral Gold | Independence Gold vs. Cassiar Gold 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |