Correlation Between Syrah Resources and Antioquia Gold

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

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

Diversification Opportunities for Syrah Resources and Antioquia Gold

-0.01

Correlation Coefficient

Syrah Resources  Antioquia Gold

Good diversification

The 3 months correlation between Syrah and Antioquia is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Syrah Resources Limited and Antioquia Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Antioquia Gold and Syrah 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 Syrah Resources Limited are associated (or correlated) with Antioquia Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Antioquia Gold has no effect on the direction of Syrah Resources i.e., Syrah Resources and Antioquia Gold go up and down completely randomly.

Pair Corralation between Syrah Resources and Antioquia Gold

Assuming the 90 days horizon Syrah Resources Limited is expected to under-perform the Antioquia Gold. But the pink sheet apears to be less risky and, when comparing its historical volatility, Syrah Resources Limited is 28.44 times less risky than Antioquia Gold. The pink sheet trades about -0.23 of its potential returns per unit of risk. The Antioquia Gold is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  2.00  in Antioquia Gold on October 5, 2024 and sell it today you would lose (0.50) from holding Antioquia Gold or give up 25.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Syrah Resources Limited  vs.  Antioquia Gold

Syrah Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Syrah Resources Limited 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 basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Antioquia Gold

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Antioquia Gold are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Antioquia Gold reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Syrah Resources and Antioquia Gold

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

The idea behind Syrah Resources Limited and Antioquia Gold 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.