Correlation Between Advance Gold and Orogen Royalties

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

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

Diversification Opportunities for Advance Gold and Orogen Royalties

0.0

Correlation Coefficient

Advance Gold  Orogen Royalties

Pay attention - limited upside

The 3 months correlation between Advance and Orogen is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Advance Gold Corp and Orogen Royalties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orogen Royalties and Advance 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 Advance Gold Corp are associated (or correlated) with Orogen Royalties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orogen Royalties has no effect on the direction of Advance Gold i.e., Advance Gold and Orogen Royalties go up and down completely randomly.

Pair Corralation between Advance Gold and Orogen Royalties

If you would invest  0.69  in Advance Gold Corp on September 15, 2024 and sell it today you would earn a total of  0.00  from holding Advance Gold Corp or generate 0.0% return on investment over 90 days.

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

Advance Gold Corp  vs.  Orogen Royalties

Advance Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Orogen Royalties

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Orogen Royalties 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 January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Advance Gold and Orogen Royalties

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

The idea behind Advance Gold Corp and Orogen Royalties 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.