Correlation Between Sixty North and Big Ridge
Can any of the company-specific risk be diversified away by investing in both Sixty North and Big Ridge 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 Sixty North and Big Ridge into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sixty North Gold and Big Ridge Gold, you can compare the effects of market volatilities on Sixty North and Big Ridge 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 Sixty North with a short position of Big Ridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sixty North and Big Ridge.
Diversification Opportunities for Sixty North and Big Ridge
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sixty and Big is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Sixty North Gold and Big Ridge Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Big Ridge Gold and Sixty North 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 Sixty North Gold are associated (or correlated) with Big Ridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Big Ridge Gold has no effect on the direction of Sixty North i.e., Sixty North and Big Ridge go up and down completely randomly.
Pair Corralation between Sixty North and Big Ridge
Assuming the 90 days horizon Sixty North Gold is expected to under-perform the Big Ridge. In addition to that, Sixty North is 5.03 times more volatile than Big Ridge Gold. It trades about -0.05 of its total potential returns per unit of risk. Big Ridge Gold is currently generating about 0.03 per unit of volatility. If you would invest 7.00 in Big Ridge Gold on September 12, 2024 and sell it today you would earn a total of 0.09 from holding Big Ridge Gold or generate 1.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Sixty North Gold vs. Big Ridge Gold
Performance |
| Timeline |
| Sixty North Gold |
| Big Ridge Gold |
Sixty North and Big Ridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sixty North and Big Ridge
The main advantage of trading using opposite Sixty North and Big Ridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sixty North position performs unexpectedly, Big Ridge 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 Big Ridge will offset losses from the drop in Big Ridge's long position.| Sixty North vs. Revival Gold | Sixty North vs. Galiano Gold | Sixty North vs. US Gold Corp | Sixty North vs. HUMANA INC |
| Big Ridge vs. Revival Gold | Big Ridge vs. Galiano Gold | Big Ridge vs. US Gold Corp | Big Ridge vs. HUMANA INC |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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