Correlation Between Ophir Gold and K92 Mining

Can any of the company-specific risk be diversified away by investing in both Ophir Gold and K92 Mining 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 Ophir Gold and K92 Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ophir Gold Corp and K92 Mining, you can compare the effects of market volatilities on Ophir Gold and K92 Mining 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 Ophir Gold with a short position of K92 Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ophir Gold and K92 Mining.

Diversification Opportunities for Ophir Gold and K92 Mining

-0.6

Correlation Coefficient

Ophir Gold  K92 Mining

Excellent diversification

The 3 months correlation between Ophir and K92 is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Ophir Gold Corp and K92 Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K92 Mining and Ophir 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 Ophir Gold Corp are associated (or correlated) with K92 Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K92 Mining has no effect on the direction of Ophir Gold i.e., Ophir Gold and K92 Mining go up and down completely randomly.

Pair Corralation between Ophir Gold and K92 Mining

Assuming the 90 days horizon Ophir Gold Corp is expected to generate 2.65 times more return on investment than K92 Mining. However, Ophir Gold is 2.65 times more volatile than K92 Mining. It trades about 0.12 of its potential returns per unit of risk. K92 Mining is currently generating about 0.03 per unit of risk. If you would invest  17.00  in Ophir Gold Corp on October 12, 2024 and sell it today you would earn a total of  22.00  from holding Ophir Gold Corp or generate 129.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	25.45%
Values	Daily Returns

Ophir Gold Corp  vs.  K92 Mining

Ophir Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

K92 Mining

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in K92 Mining are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, K92 Mining may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Ophir Gold and K92 Mining

The main advantage of trading using opposite Ophir Gold and K92 Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ophir Gold position performs unexpectedly, K92 Mining 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 K92 Mining will offset losses from the drop in K92 Mining's long position.

The idea behind Ophir Gold Corp and K92 Mining 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.