Correlation Between Artemis Gold and Ascot Resources

Can any of the company-specific risk be diversified away by investing in both Artemis Gold and Ascot 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 Artemis Gold and Ascot Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Artemis Gold and Ascot Resources, you can compare the effects of market volatilities on Artemis Gold and Ascot 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 Artemis Gold with a short position of Ascot Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artemis Gold and Ascot Resources.

Diversification Opportunities for Artemis Gold and Ascot Resources

0.49

Correlation Coefficient

Artemis Gold  Ascot Resources

Very weak diversification

The 3 months correlation between Artemis and Ascot is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Artemis Gold and Ascot Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ascot Resources and Artemis 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 Artemis Gold are associated (or correlated) with Ascot Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ascot Resources has no effect on the direction of Artemis Gold i.e., Artemis Gold and Ascot Resources go up and down completely randomly.

Pair Corralation between Artemis Gold and Ascot Resources

Assuming the 90 days trading horizon Artemis Gold is expected to generate 0.43 times more return on investment than Ascot Resources. However, Artemis Gold is 2.31 times less risky than Ascot Resources. It trades about 0.11 of its potential returns per unit of risk. Ascot Resources is currently generating about -0.02 per unit of risk. If you would invest  650.00  in Artemis Gold on September 23, 2024 and sell it today you would earn a total of  761.00  from holding Artemis Gold or generate 117.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Artemis Gold  vs.  Ascot Resources

Artemis Gold

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Artemis Gold are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Artemis Gold may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Ascot Resources

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ascot Resources are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, Ascot Resources displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Artemis Gold and Ascot Resources

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

The idea behind Artemis Gold and Ascot Resources 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.

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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.