Correlation Between Vista Gold and Morguard

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

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

Diversification Opportunities for Vista Gold and Morguard

0.75

Correlation Coefficient

Vista Gold  Morguard

Poor diversification

The 3 months correlation between Vista and Morguard is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Vista Gold and Morguard in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morguard and Vista 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 Vista Gold are associated (or correlated) with Morguard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morguard has no effect on the direction of Vista Gold i.e., Vista Gold and Morguard go up and down completely randomly.

Pair Corralation between Vista Gold and Morguard

Assuming the 90 days trading horizon Vista Gold is expected to generate 3.03 times more return on investment than Morguard. However, Vista Gold is 3.03 times more volatile than Morguard. It trades about 0.18 of its potential returns per unit of risk. Morguard is currently generating about 0.1 per unit of risk. If you would invest  77.00  in Vista Gold on December 30, 2024 and sell it today you would earn a total of  35.00  from holding Vista Gold or generate 45.45% return on investment over 90 days.

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

Vista Gold  vs.  Morguard

Vista Gold

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vista Gold are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, Vista Gold displayed solid returns over the last few months and may actually be approaching a breakup point.

Morguard

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Morguard are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very weak fundamental indicators, Morguard may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Vista Gold and Morguard

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

The idea behind Vista Gold and Morguard 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.

Check out your portfolio center.

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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.