Correlation Between Aurania Resources and Adamera Minerals

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

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

Diversification Opportunities for Aurania Resources and Adamera Minerals

0.0

Correlation Coefficient

Aurania Resources  Adamera Minerals

Pay attention - limited upside

The 3 months correlation between Aurania and Adamera is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aurania Resources and Adamera Minerals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adamera Minerals Corp and Aurania Resources 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 Aurania Resources are associated (or correlated) with Adamera Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adamera Minerals Corp has no effect on the direction of Aurania Resources i.e., Aurania Resources and Adamera Minerals go up and down completely randomly.

Pair Corralation between Aurania Resources and Adamera Minerals

If you would invest  29.00  in Aurania Resources on December 30, 2024 and sell it today you would lose (4.00) from holding Aurania Resources or give up 13.79% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Aurania Resources  vs.  Adamera Minerals Corp

Aurania Resources

Risk-Adjusted Performance

Weak

Over the last 90 days Aurania Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Aurania Resources is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Adamera Minerals Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Adamera Minerals Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Adamera Minerals is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Aurania Resources and Adamera Minerals

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

The idea behind Aurania Resources and Adamera Minerals Corp 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.