Correlation Between Golden Lake and Strategic Resources

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

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

Diversification Opportunities for Golden Lake and Strategic Resources

0.0

Correlation Coefficient

Golden Lake  Strategic Resources

Pay attention - limited upside

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

Pair Corralation between Golden Lake and Strategic Resources

If you would invest  47.00  in Strategic Resources on September 3, 2024 and sell it today you would earn a total of  0.00  from holding Strategic Resources or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Golden Lake Exploration  vs.  Strategic Resources

Golden Lake Exploration

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Golden Lake Exploration has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Strategic Resources

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Golden Lake and Strategic Resources

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

The idea behind Golden Lake Exploration and Strategic 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.