Correlation Between Thunder Gold and Rokmaster Resources

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

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

Diversification Opportunities for Thunder Gold and Rokmaster Resources

-0.26

Correlation Coefficient

Thunder Gold  Rokmaster Resources

Very good diversification

The 3 months correlation between Thunder and Rokmaster is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Thunder Gold Corp and Rokmaster Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rokmaster Resources Corp and Thunder 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 Thunder Gold Corp are associated (or correlated) with Rokmaster Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rokmaster Resources Corp has no effect on the direction of Thunder Gold i.e., Thunder Gold and Rokmaster Resources go up and down completely randomly.

Pair Corralation between Thunder Gold and Rokmaster Resources

Assuming the 90 days horizon Thunder Gold Corp is expected to generate 2.53 times more return on investment than Rokmaster Resources. However, Thunder Gold is 2.53 times more volatile than Rokmaster Resources Corp. It trades about 0.12 of its potential returns per unit of risk. Rokmaster Resources Corp is currently generating about 0.04 per unit of risk. If you would invest  2.78  in Thunder Gold Corp on December 30, 2024 and sell it today you would earn a total of  1.57  from holding Thunder Gold Corp or generate 56.47% return on investment over 90 days.

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

Thunder Gold Corp  vs.  Rokmaster Resources Corp

Thunder Gold Corp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Thunder Gold Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak essential indicators, Thunder Gold reported solid returns over the last few months and may actually be approaching a breakup point.

Rokmaster Resources Corp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Rokmaster Resources Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Rokmaster Resources reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Thunder Gold and Rokmaster Resources

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

The idea behind Thunder Gold Corp and Rokmaster Resources 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.