Correlation Between Wesdome Gold and Satori Resources
Can any of the company-specific risk be diversified away by investing in both Wesdome Gold and Satori Resources 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 Satori Resources 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 Satori Resources, you can compare the effects of market volatilities on Wesdome Gold and Satori Resources 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 Satori Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wesdome Gold and Satori Resources.
Diversification Opportunities for Wesdome Gold and Satori Resources
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Wesdome and Satori is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Wesdome Gold Mines and Satori Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Satori Resources 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 Satori Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Satori Resources has no effect on the direction of Wesdome Gold i.e., Wesdome Gold and Satori Resources go up and down completely randomly.
Pair Corralation between Wesdome Gold and Satori Resources
Assuming the 90 days horizon Wesdome Gold is expected to generate 4.26 times less return on investment than Satori Resources. But when comparing it to its historical volatility, Wesdome Gold Mines is 2.73 times less risky than Satori Resources. It trades about 0.04 of its potential returns per unit of risk. Satori Resources is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2.46 in Satori Resources on September 24, 2024 and sell it today you would earn a total of 8.54 from holding Satori Resources or generate 347.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wesdome Gold Mines vs. Satori Resources
Performance |
| Timeline |
| Wesdome Gold Mines |
| Satori Resources |
Wesdome Gold and Satori Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wesdome Gold and Satori Resources
The main advantage of trading using opposite Wesdome Gold and Satori Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wesdome Gold position performs unexpectedly, Satori Resources 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 Satori Resources will offset losses from the drop in Satori Resources' long position.| Wesdome Gold vs. Puma Exploration | Wesdome Gold vs. Sixty North Gold | Wesdome Gold vs. Red Pine Exploration | Wesdome Gold vs. Altamira Gold Corp |
| Satori Resources vs. Labrador Gold Corp | Satori Resources vs. Lion One Metals | Satori Resources vs. Westhaven Gold Corp | Satori Resources vs. Wesdome Gold Mines |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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