Correlation Between Amex Exploration and Augusta Gold

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

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

Diversification Opportunities for Amex Exploration and Augusta Gold

-0.67

Correlation Coefficient

Amex Exploration  Augusta Gold

Excellent diversification

The 3 months correlation between Amex and Augusta is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Amex Exploration and Augusta Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Augusta Gold Corp and Amex Exploration 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 Amex Exploration are associated (or correlated) with Augusta Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Augusta Gold Corp has no effect on the direction of Amex Exploration i.e., Amex Exploration and Augusta Gold go up and down completely randomly.

Pair Corralation between Amex Exploration and Augusta Gold

Assuming the 90 days horizon Amex Exploration is expected to generate 46.55 times less return on investment than Augusta Gold. But when comparing it to its historical volatility, Amex Exploration is 1.68 times less risky than Augusta Gold. It trades about 0.01 of its potential returns per unit of risk. Augusta Gold Corp is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  61.00  in Augusta Gold Corp on September 14, 2024 and sell it today you would earn a total of  44.00  from holding Augusta Gold Corp or generate 72.13% return on investment over 90 days.

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

Amex Exploration  vs.  Augusta Gold Corp

Amex Exploration

Risk-Adjusted Performance

0 of 100

Very Weak

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

Augusta Gold Corp

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Augusta Gold Corp are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Augusta Gold reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amex Exploration and Augusta Gold

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

The idea behind Amex Exploration and Augusta Gold 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.