Correlation Between Eskay Mining and Eastfield Resources

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

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

Diversification Opportunities for Eskay Mining and Eastfield Resources

0.0

Correlation Coefficient

Eskay Mining  Eastfield Resources

Pay attention - limited upside

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

Pair Corralation between Eskay Mining and Eastfield Resources

If you would invest  3.00  in Eastfield Resources on September 25, 2024 and sell it today you would earn a total of  0.00  from holding Eastfield Resources or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Eskay Mining Corp  vs.  Eastfield Resources

Eskay Mining Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eskay Mining Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Eskay Mining is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Eastfield Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eastfield Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Eastfield Resources is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Eskay Mining and Eastfield Resources

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

The idea behind Eskay Mining Corp and Eastfield 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.