Correlation Between TinOne Resources and Westward Gold
Can any of the company-specific risk be diversified away by investing in both TinOne Resources and Westward 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 TinOne Resources and Westward Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TinOne Resources and Westward Gold, you can compare the effects of market volatilities on TinOne Resources and Westward 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 TinOne Resources with a short position of Westward Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of TinOne Resources and Westward Gold.
Diversification Opportunities for TinOne Resources and Westward Gold
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between TinOne and Westward is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding TinOne Resources and Westward Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westward Gold and TinOne 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 TinOne Resources are associated (or correlated) with Westward Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westward Gold has no effect on the direction of TinOne Resources i.e., TinOne Resources and Westward Gold go up and down completely randomly.
Pair Corralation between TinOne Resources and Westward Gold
Assuming the 90 days horizon TinOne Resources is expected to generate 4.0 times more return on investment than Westward Gold. However, TinOne Resources is 4.0 times more volatile than Westward Gold. It trades about 0.08 of its potential returns per unit of risk. Westward Gold is currently generating about 0.04 per unit of risk. If you would invest 7.78 in TinOne Resources on August 30, 2024 and sell it today you would lose (4.35) from holding TinOne Resources or give up 55.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
TinOne Resources vs. Westward Gold
Performance |
| Timeline |
| TinOne Resources |
| Westward Gold |
TinOne Resources and Westward Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TinOne Resources and Westward Gold
The main advantage of trading using opposite TinOne Resources and Westward Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TinOne Resources position performs unexpectedly, Westward 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 Westward Gold will offset losses from the drop in Westward Gold's long position.| TinOne Resources vs. Vertiv Holdings Co | TinOne Resources vs. Nasdaq Inc | TinOne Resources vs. McDonalds | TinOne Resources vs. Walmart |
| Westward Gold vs. Vertiv Holdings Co | Westward Gold vs. Nasdaq Inc | Westward Gold vs. McDonalds | Westward Gold vs. Walmart |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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