Correlation Between Robex Resources and Independence Gold

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

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

Diversification Opportunities for Robex Resources and Independence Gold

0.06

Correlation Coefficient

Robex Resources  Independence Gold

Significant diversification

The 3 months correlation between Robex and Independence is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Robex Resources and Independence Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Independence Gold Corp 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 Independence Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Independence Gold Corp has no effect on the direction of Robex Resources i.e., Robex Resources and Independence Gold go up and down completely randomly.

Pair Corralation between Robex Resources and Independence Gold

Assuming the 90 days horizon Robex Resources is expected to under-perform the Independence Gold. But the pink sheet apears to be less risky and, when comparing its historical volatility, Robex Resources is 2.26 times less risky than Independence Gold. The pink sheet trades about -0.11 of its potential returns per unit of risk. The Independence Gold Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  17.00  in Independence Gold Corp on September 2, 2024 and sell it today you would lose (1.00) from holding Independence Gold Corp or give up 5.88% of portfolio value over 90 days.

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

Robex Resources  vs.  Independence 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.

Independence Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Robex Resources and Independence Gold

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

The idea behind Robex Resources and Independence 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.