Correlation Between Cassiar Gold and Endeavour Silver

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

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

Diversification Opportunities for Cassiar Gold and Endeavour Silver

0.81

Correlation Coefficient

Cassiar Gold  Endeavour Silver

Very poor diversification

The 3 months correlation between Cassiar and Endeavour is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Cassiar Gold Corp and Endeavour Silver Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Endeavour Silver Corp and Cassiar 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 Cassiar Gold Corp are associated (or correlated) with Endeavour Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Endeavour Silver Corp has no effect on the direction of Cassiar Gold i.e., Cassiar Gold and Endeavour Silver go up and down completely randomly.

Pair Corralation between Cassiar Gold and Endeavour Silver

Assuming the 90 days trading horizon Cassiar Gold Corp is expected to under-perform the Endeavour Silver. But the stock apears to be less risky and, when comparing its historical volatility, Cassiar Gold Corp is 1.51 times less risky than Endeavour Silver. The stock trades about -0.09 of its potential returns per unit of risk. The Endeavour Silver Corp is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  534.00  in Endeavour Silver Corp on October 22, 2024 and sell it today you would lose (24.00) from holding Endeavour Silver Corp or give up 4.49% of portfolio value over 90 days.

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

Cassiar Gold Corp  vs.  Endeavour Silver Corp

Cassiar Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cassiar Gold Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's fundamental indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Endeavour Silver Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Endeavour Silver Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Cassiar Gold and Endeavour Silver

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

The idea behind Cassiar Gold Corp and Endeavour Silver 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.