Correlation Between Wesdome Gold and K92 Mining
Can any of the company-specific risk be diversified away by investing in both Wesdome Gold and K92 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 Wesdome Gold and K92 Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wesdome Gold Mines and K92 Mining, you can compare the effects of market volatilities on Wesdome Gold and K92 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 Wesdome Gold with a short position of K92 Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wesdome Gold and K92 Mining.
Diversification Opportunities for Wesdome Gold and K92 Mining
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Wesdome and K92 is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Wesdome Gold Mines and K92 Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K92 Mining and Wesdome 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 Wesdome Gold Mines are associated (or correlated) with K92 Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K92 Mining has no effect on the direction of Wesdome Gold i.e., Wesdome Gold and K92 Mining go up and down completely randomly.
Pair Corralation between Wesdome Gold and K92 Mining
Assuming the 90 days trading horizon Wesdome Gold Mines is expected to under-perform the K92 Mining. But the stock apears to be less risky and, when comparing its historical volatility, Wesdome Gold Mines is 1.01 times less risky than K92 Mining. The stock trades about -0.04 of its potential returns per unit of risk. The K92 Mining is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 915.00 in K92 Mining on August 29, 2024 and sell it today you would lose (11.00) from holding K92 Mining or give up 1.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wesdome Gold Mines vs. K92 Mining
Performance |
| Timeline |
| Wesdome Gold Mines |
| K92 Mining |
Wesdome Gold and K92 Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wesdome Gold and K92 Mining
The main advantage of trading using opposite Wesdome Gold and K92 Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wesdome Gold position performs unexpectedly, K92 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 K92 Mining will offset losses from the drop in K92 Mining's long position.| Wesdome Gold vs. OceanaGold | Wesdome Gold vs. Torex Gold Resources | Wesdome Gold vs. Alamos Gold | Wesdome Gold vs. Dundee Precious Metals |
| K92 Mining vs. Calibre Mining Corp | K92 Mining vs. Wesdome Gold Mines | K92 Mining vs. Equinox Gold Corp | K92 Mining vs. Orla Mining |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |