Correlation Between Equinox Gold and Artemis Gold

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

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

Diversification Opportunities for Equinox Gold and Artemis Gold

0.36

Correlation Coefficient

Equinox Gold  Artemis Gold

Weak diversification

The 3 months correlation between Equinox and Artemis is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Equinox Gold Corp and Artemis Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artemis Gold and Equinox 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 Equinox Gold Corp are associated (or correlated) with Artemis Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artemis Gold has no effect on the direction of Equinox Gold i.e., Equinox Gold and Artemis Gold go up and down completely randomly.

Pair Corralation between Equinox Gold and Artemis Gold

Assuming the 90 days trading horizon Equinox Gold Corp is expected to under-perform the Artemis Gold. In addition to that, Equinox Gold is 1.08 times more volatile than Artemis Gold. It trades about -0.03 of its total potential returns per unit of risk. Artemis Gold is currently generating about -0.01 per unit of volatility. If you would invest  1,475  in Artemis Gold on September 22, 2024 and sell it today you would lose (64.00) from holding Artemis Gold or give up 4.34% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	97.78%
Values	Daily Returns

Equinox Gold Corp  vs.  Artemis Gold

Equinox Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Equinox Gold Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Equinox Gold is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

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.

Pair Trading with Equinox Gold and Artemis Gold

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

The idea behind Equinox Gold Corp and Artemis Gold 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.