Correlation Between Grosvenor Resource and Xtra Gold

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

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

Diversification Opportunities for Grosvenor Resource and Xtra Gold

0.0

Correlation Coefficient

Grosvenor Resource  Xtra Gold

Pay attention - limited upside

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

Pair Corralation between Grosvenor Resource and Xtra Gold

If you would invest  4.00  in Grosvenor Resource Corp on October 23, 2024 and sell it today you would earn a total of  0.00  from holding Grosvenor Resource Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Grosvenor Resource Corp  vs.  Xtra Gold Resources Corp

Grosvenor Resource Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Xtra Gold Resources

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Xtra Gold Resources Corp are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very weak technical and fundamental indicators, Xtra Gold displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Grosvenor Resource and Xtra Gold

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

The idea behind Grosvenor Resource Corp and Xtra Gold Resources 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.

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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.