Correlation Between ValOre Metals and ALX Resources

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

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

Diversification Opportunities for ValOre Metals and ALX Resources

0.0

Correlation Coefficient

ValOre Metals  ALX Resources

Pay attention - limited upside

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

Pair Corralation between ValOre Metals and ALX Resources

If you would invest (100.00) in ALX Resources Corp on December 25, 2024 and sell it today you would earn a total of  100.00  from holding ALX Resources Corp or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

ValOre Metals Corp  vs.  ALX Resources Corp

ValOre Metals Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days ValOre Metals Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

ALX Resources Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days ALX Resources Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, ALX 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 ValOre Metals and ALX Resources

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

The idea behind ValOre Metals Corp and ALX 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.