Correlation Between Orbit Garant and Golden Pursuit

Can any of the company-specific risk be diversified away by investing in both Orbit Garant and Golden Pursuit 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 Orbit Garant and Golden Pursuit into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Orbit Garant and Golden Pursuit

0.5

Correlation Coefficient

Orbit Garant  Golden Pursuit

Very weak diversification

The 3 months correlation between Orbit and Golden is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Orbit Garant Drilling and Golden Pursuit Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Pursuit Resources and Orbit Garant 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 Orbit Garant Drilling are associated (or correlated) with Golden Pursuit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Pursuit Resources has no effect on the direction of Orbit Garant i.e., Orbit Garant and Golden Pursuit go up and down completely randomly.

Pair Corralation between Orbit Garant and Golden Pursuit

Assuming the 90 days trading horizon Orbit Garant Drilling is expected to generate 0.91 times more return on investment than Golden Pursuit. However, Orbit Garant Drilling is 1.1 times less risky than Golden Pursuit. It trades about 0.16 of its potential returns per unit of risk. Golden Pursuit Resources is currently generating about 0.04 per unit of risk. If you would invest  84.00  in Orbit Garant Drilling on December 29, 2024 and sell it today you would earn a total of  37.00  from holding Orbit Garant Drilling or generate 44.05% return on investment over 90 days.

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

Orbit Garant Drilling  vs.  Golden Pursuit Resources

Orbit Garant Drilling

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Orbit Garant Drilling are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal fundamental indicators, Orbit Garant displayed solid returns over the last few months and may actually be approaching a breakup point.

Golden Pursuit Resources

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Golden Pursuit Resources are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Golden Pursuit may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Orbit Garant and Golden Pursuit

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

The idea behind Orbit Garant Drilling and Golden Pursuit 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.