Correlation Between Osisko Gold and Gold Reserve

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

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

Diversification Opportunities for Osisko Gold and Gold Reserve

-0.49

Correlation Coefficient

Osisko Gold  Gold Reserve

Very good diversification

The 3 months correlation between Osisko and Gold is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Osisko Gold Ro and Gold Reserve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Reserve and Osisko 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 Osisko Gold Ro are associated (or correlated) with Gold Reserve. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Reserve has no effect on the direction of Osisko Gold i.e., Osisko Gold and Gold Reserve go up and down completely randomly.

Pair Corralation between Osisko Gold and Gold Reserve

Allowing for the 90-day total investment horizon Osisko Gold Ro is expected to generate 0.19 times more return on investment than Gold Reserve. However, Osisko Gold Ro is 5.32 times less risky than Gold Reserve. It trades about 0.11 of its potential returns per unit of risk. Gold Reserve is currently generating about -0.09 per unit of risk. If you would invest  1,808  in Osisko Gold Ro on September 13, 2024 and sell it today you would earn a total of  207.00  from holding Osisko Gold Ro or generate 11.45% return on investment over 90 days.

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

Osisko Gold Ro  vs.  Gold Reserve

Osisko Gold Ro

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Osisko Gold Ro are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Osisko Gold may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Gold Reserve

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gold Reserve 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 Osisko Gold and Gold Reserve

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

The idea behind Osisko Gold Ro and Gold Reserve 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.