Correlation Between West Vault and Aurion Resources
Can any of the company-specific risk be diversified away by investing in both West Vault and Aurion 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 West Vault and Aurion Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between West Vault Mining and Aurion Resources, you can compare the effects of market volatilities on West Vault and Aurion 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 West Vault with a short position of Aurion Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of West Vault and Aurion Resources.
Diversification Opportunities for West Vault and Aurion Resources
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between West and Aurion is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding West Vault Mining and Aurion Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurion Resources and West Vault 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 West Vault Mining are associated (or correlated) with Aurion Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurion Resources has no effect on the direction of West Vault i.e., West Vault and Aurion Resources go up and down completely randomly.
Pair Corralation between West Vault and Aurion Resources
Assuming the 90 days horizon West Vault Mining is expected to under-perform the Aurion Resources. In addition to that, West Vault is 1.23 times more volatile than Aurion Resources. It trades about -0.2 of its total potential returns per unit of risk. Aurion Resources is currently generating about -0.16 per unit of volatility. If you would invest 48.00 in Aurion Resources on September 1, 2024 and sell it today you would lose (7.00) from holding Aurion Resources or give up 14.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
West Vault Mining vs. Aurion Resources
Performance |
| Timeline |
| West Vault Mining |
| Aurion Resources |
West Vault and Aurion Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with West Vault and Aurion Resources
The main advantage of trading using opposite West Vault and Aurion Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if West Vault position performs unexpectedly, Aurion 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 Aurion Resources will offset losses from the drop in Aurion Resources' long position.| West Vault vs. Aurelius Minerals | West Vault vs. Quebec Precious Metals | West Vault vs. Omineca Mining and | West Vault vs. Altamira Gold Corp |
| Aurion Resources vs. Minnova Corp | Aurion Resources vs. Argo Gold | Aurion Resources vs. Advance Gold Corp | Aurion Resources vs. Blue Star Gold |
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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