Correlation Between Prosper Gold and Bluestone Resources

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

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

Diversification Opportunities for Prosper Gold and Bluestone Resources

0.5

Correlation Coefficient

Prosper Gold  Bluestone Resources

Very weak diversification

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

Pair Corralation between Prosper Gold and Bluestone Resources

Assuming the 90 days horizon Prosper Gold is expected to generate 2.26 times less return on investment than Bluestone Resources. But when comparing it to its historical volatility, Prosper Gold Corp is 1.36 times less risky than Bluestone Resources. It trades about 0.01 of its potential returns per unit of risk. Bluestone Resources is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  50.00  in Bluestone Resources on October 8, 2024 and sell it today you would lose (19.00) from holding Bluestone Resources or give up 38.0% of portfolio value over 90 days.

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

Prosper Gold Corp  vs.  Bluestone Resources

Prosper Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Bluestone Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bluestone Resources 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 February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Prosper Gold and Bluestone Resources

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

The idea behind Prosper Gold Corp and Bluestone 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.