Correlation Between Regis Resources and Cache Exploration

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

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

Diversification Opportunities for Regis Resources and Cache Exploration

0.0

Correlation Coefficient

Regis Resources  Cache Exploration

Pay attention - limited upside

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

Pair Corralation between Regis Resources and Cache Exploration

If you would invest  128.00  in Regis Resources on October 7, 2024 and sell it today you would earn a total of  22.00  from holding Regis Resources or generate 17.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Regis Resources  vs.  Cache Exploration

Regis Resources

Risk-Adjusted Performance

5 of 100

Modest

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

Cache Exploration

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cache Exploration has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Cache Exploration is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Regis Resources and Cache Exploration

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

The idea behind Regis Resources and Cache Exploration 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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .