Correlation Between Leviathan Gold and Robex Resources

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

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

Diversification Opportunities for Leviathan Gold and Robex Resources

0.66

Correlation Coefficient

Leviathan Gold  Robex Resources

Poor diversification

The 3 months correlation between Leviathan and Robex is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Leviathan Gold and Robex Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robex Resources and Leviathan 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 Leviathan Gold are associated (or correlated) with Robex Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robex Resources has no effect on the direction of Leviathan Gold i.e., Leviathan Gold and Robex Resources go up and down completely randomly.

Pair Corralation between Leviathan Gold and Robex Resources

Assuming the 90 days horizon Leviathan Gold is expected to generate 4.61 times more return on investment than Robex Resources. However, Leviathan Gold is 4.61 times more volatile than Robex Resources. It trades about 0.18 of its potential returns per unit of risk. Robex Resources is currently generating about 0.08 per unit of risk. If you would invest  3.46  in Leviathan Gold on December 30, 2024 and sell it today you would earn a total of  6.54  from holding Leviathan Gold or generate 189.02% return on investment over 90 days.

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

Leviathan Gold  vs.  Robex Resources

Leviathan Gold

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Leviathan Gold are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Leviathan Gold reported solid returns over the last few months and may actually be approaching a breakup point.

Robex Resources

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Robex Resources are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental drivers, Robex Resources reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Leviathan Gold and Robex Resources

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

The idea behind Leviathan Gold and Robex 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.