Correlation Between Tarku Resources and Juggernaut Exploration

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

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

Diversification Opportunities for Tarku Resources and Juggernaut Exploration

-0.46

Correlation Coefficient

Tarku Resources  Juggernaut Exploration

Very good diversification

The 3 months correlation between Tarku and Juggernaut is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Tarku Resources and Juggernaut Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Juggernaut Exploration and Tarku 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 Tarku Resources are associated (or correlated) with Juggernaut Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Juggernaut Exploration has no effect on the direction of Tarku Resources i.e., Tarku Resources and Juggernaut Exploration go up and down completely randomly.

Pair Corralation between Tarku Resources and Juggernaut Exploration

Assuming the 90 days horizon Tarku Resources is expected to generate 33.0 times less return on investment than Juggernaut Exploration. But when comparing it to its historical volatility, Tarku Resources is 2.5 times less risky than Juggernaut Exploration. It trades about 0.01 of its potential returns per unit of risk. Juggernaut Exploration is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  3.80  in Juggernaut Exploration on December 30, 2024 and sell it today you would earn a total of  1.70  from holding Juggernaut Exploration or generate 44.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	78.13%
Values	Daily Returns

Tarku Resources  vs.  Juggernaut Exploration

Tarku Resources

Risk-Adjusted Performance

Very Weak

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

Juggernaut Exploration

Risk-Adjusted Performance

OK

Over the last 90 days Juggernaut Exploration has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly fragile basic indicators, Juggernaut Exploration reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Tarku Resources and Juggernaut Exploration

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

The idea behind Tarku Resources and Juggernaut 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.