Correlation Between Robex Resources and I 80

Can any of the company-specific risk be diversified away by investing in both Robex Resources and I 80 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 Robex Resources and I 80 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Robex Resources and I 80 Gold Corp, you can compare the effects of market volatilities on Robex Resources and I 80 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 Robex Resources with a short position of I 80. Check out your portfolio center. Please also check ongoing floating volatility patterns of Robex Resources and I 80.

Diversification Opportunities for Robex Resources and I 80

0.65

Correlation Coefficient

Robex Resources  I 80

Poor diversification

The 3 months correlation between Robex and IAUX is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Robex Resources and I 80 Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on I 80 Gold and Robex 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 Robex Resources are associated (or correlated) with I 80. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of I 80 Gold has no effect on the direction of Robex Resources i.e., Robex Resources and I 80 go up and down completely randomly.

Pair Corralation between Robex Resources and I 80

Assuming the 90 days horizon Robex Resources is expected to under-perform the I 80. But the pink sheet apears to be less risky and, when comparing its historical volatility, Robex Resources is 3.81 times less risky than I 80. The pink sheet trades about -0.11 of its potential returns per unit of risk. The I 80 Gold Corp is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  101.00  in I 80 Gold Corp on September 2, 2024 and sell it today you would lose (38.00) from holding I 80 Gold Corp or give up 37.62% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.46%
Values	Daily Returns

Robex Resources  vs.  I 80 Gold Corp

Robex Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Robex Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's fundamental drivers remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

I 80 Gold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days I 80 Gold Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Robex Resources and I 80

The main advantage of trading using opposite Robex Resources and I 80 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Robex Resources position performs unexpectedly, I 80 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 I 80 will offset losses from the drop in I 80's long position.

The idea behind Robex Resources and I 80 Gold Corp 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.