Correlation Between Osisko Metals and FIREWEED METALS

Can any of the company-specific risk be diversified away by investing in both Osisko Metals and FIREWEED METALS 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 Osisko Metals and FIREWEED METALS into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Osisko Metals and FIREWEED METALS P, you can compare the effects of market volatilities on Osisko Metals and FIREWEED METALS 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 Osisko Metals with a short position of FIREWEED METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Osisko Metals and FIREWEED METALS.

Diversification Opportunities for Osisko Metals and FIREWEED METALS

0.58

Correlation Coefficient

Osisko Metals  FIREWEED METALS

Very weak diversification

The 3 months correlation between Osisko and FIREWEED is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Osisko Metals and FIREWEED METALS P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIREWEED METALS P and Osisko Metals 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 Osisko Metals are associated (or correlated) with FIREWEED METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIREWEED METALS P has no effect on the direction of Osisko Metals i.e., Osisko Metals and FIREWEED METALS go up and down completely randomly.

Pair Corralation between Osisko Metals and FIREWEED METALS

Assuming the 90 days trading horizon Osisko Metals is expected to generate 1.41 times more return on investment than FIREWEED METALS. However, Osisko Metals is 1.41 times more volatile than FIREWEED METALS P. It trades about 0.15 of its potential returns per unit of risk. FIREWEED METALS P is currently generating about 0.08 per unit of risk. If you would invest  21.00  in Osisko Metals on December 22, 2024 and sell it today you would earn a total of  9.00  from holding Osisko Metals or generate 42.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Osisko Metals  vs.  FIREWEED METALS P

Osisko Metals

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Osisko Metals are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Osisko Metals unveiled solid returns over the last few months and may actually be approaching a breakup point.

FIREWEED METALS P

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in FIREWEED METALS P are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, FIREWEED METALS reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Osisko Metals and FIREWEED METALS

The main advantage of trading using opposite Osisko Metals and FIREWEED METALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Osisko Metals position performs unexpectedly, FIREWEED METALS 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 FIREWEED METALS will offset losses from the drop in FIREWEED METALS's long position.

The idea behind Osisko Metals and FIREWEED METALS P pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.