Correlation Between Teuton Resources and Grande Portage
Can any of the company-specific risk be diversified away by investing in both Teuton Resources and Grande Portage 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 Teuton Resources and Grande Portage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teuton Resources Corp and Grande Portage Resources, you can compare the effects of market volatilities on Teuton Resources and Grande Portage 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 Teuton Resources with a short position of Grande Portage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teuton Resources and Grande Portage.
Diversification Opportunities for Teuton Resources and Grande Portage
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Teuton and Grande is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Teuton Resources Corp and Grande Portage Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grande Portage Resources and Teuton 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 Teuton Resources Corp are associated (or correlated) with Grande Portage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grande Portage Resources has no effect on the direction of Teuton Resources i.e., Teuton Resources and Grande Portage go up and down completely randomly.
Pair Corralation between Teuton Resources and Grande Portage
Assuming the 90 days horizon Teuton Resources Corp is expected to generate 0.41 times more return on investment than Grande Portage. However, Teuton Resources Corp is 2.45 times less risky than Grande Portage. It trades about -0.31 of its potential returns per unit of risk. Grande Portage Resources is currently generating about -0.28 per unit of risk. If you would invest 142.00 in Teuton Resources Corp on August 30, 2024 and sell it today you would lose (29.00) from holding Teuton Resources Corp or give up 20.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Teuton Resources Corp vs. Grande Portage Resources
Performance |
| Timeline |
| Teuton Resources Corp |
| Grande Portage Resources |
Teuton Resources and Grande Portage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teuton Resources and Grande Portage
The main advantage of trading using opposite Teuton Resources and Grande Portage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teuton Resources position performs unexpectedly, Grande Portage 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 Grande Portage will offset losses from the drop in Grande Portage's long position.| Teuton Resources vs. First Majestic Silver | Teuton Resources vs. Ivanhoe Energy | Teuton Resources vs. Orezone Gold Corp | Teuton Resources vs. Faraday Copper Corp |
| Grande Portage vs. Galantas Gold Corp | Grande Portage vs. Strikepoint Gold | Grande Portage vs. Kore Mining | Grande Portage vs. Outcrop 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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