Correlation Between Klondike Silver and Mason Graphite

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

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

Diversification Opportunities for Klondike Silver and Mason Graphite

0.33

Correlation Coefficient

Klondike Silver  Mason Graphite

Weak diversification

The 3 months correlation between Klondike and Mason is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Klondike Silver Corp and Mason Graphite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mason Graphite and Klondike Silver 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 Klondike Silver Corp are associated (or correlated) with Mason Graphite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mason Graphite has no effect on the direction of Klondike Silver i.e., Klondike Silver and Mason Graphite go up and down completely randomly.

Pair Corralation between Klondike Silver and Mason Graphite

Given the investment horizon of 90 days Klondike Silver Corp is expected to generate 1.58 times more return on investment than Mason Graphite. However, Klondike Silver is 1.58 times more volatile than Mason Graphite. It trades about 0.04 of its potential returns per unit of risk. Mason Graphite is currently generating about 0.0 per unit of risk. If you would invest  4.00  in Klondike Silver Corp on September 28, 2024 and sell it today you would lose (2.00) from holding Klondike Silver Corp or give up 50.0% of portfolio value over 90 days.

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

Klondike Silver Corp  vs.  Mason Graphite

Klondike Silver Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Mason Graphite

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Mason Graphite are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Mason Graphite showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Klondike Silver and Mason Graphite

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

The idea behind Klondike Silver Corp and Mason Graphite 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.