Correlation Between Stillwater Critical and Golden Pursuit

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

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

Diversification Opportunities for Stillwater Critical and Golden Pursuit

-0.06

Correlation Coefficient

Stillwater Critical  Golden Pursuit

Good diversification

The 3 months correlation between Stillwater and Golden is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Stillwater Critical Minerals 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 Stillwater Critical 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 Stillwater Critical Minerals 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 Stillwater Critical i.e., Stillwater Critical and Golden Pursuit go up and down completely randomly.

Pair Corralation between Stillwater Critical and Golden Pursuit

Assuming the 90 days horizon Stillwater Critical Minerals is expected to under-perform the Golden Pursuit. But the stock apears to be less risky and, when comparing its historical volatility, Stillwater Critical Minerals is 1.3 times less risky than Golden Pursuit. The stock trades about -0.11 of its potential returns per unit of risk. The Golden Pursuit Resources is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  18.00  in Golden Pursuit Resources on December 2, 2024 and sell it today you would earn a total of  1.00  from holding Golden Pursuit Resources or generate 5.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

Stillwater Critical Minerals  vs.  Golden Pursuit Resources

Stillwater Critical

Risk-Adjusted Performance

Very Weak

Over the last 90 days Stillwater Critical Minerals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

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 unfluctuating basic indicators, Golden Pursuit showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Stillwater Critical and Golden Pursuit

The main advantage of trading using opposite Stillwater Critical and Golden Pursuit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stillwater Critical 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 Stillwater Critical Minerals 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..