Correlation Between Oroco Resource and St Georges

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

By analyzing existing cross correlation between Oroco Resource Corp and St Georges Eco Mining Corp, you can compare the effects of market volatilities on Oroco Resource and St Georges 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 Oroco Resource with a short position of St Georges. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oroco Resource and St Georges.

Diversification Opportunities for Oroco Resource and St Georges

0.2

Correlation Coefficient

Oroco Resource  St Georges

Modest diversification

The 3 months correlation between Oroco and SXOOF is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Oroco Resource Corp and St Georges Eco Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on St Georges Eco and Oroco Resource 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 Oroco Resource Corp are associated (or correlated) with St Georges. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of St Georges Eco has no effect on the direction of Oroco Resource i.e., Oroco Resource and St Georges go up and down completely randomly.

Pair Corralation between Oroco Resource and St Georges

Assuming the 90 days horizon Oroco Resource Corp is expected to under-perform the St Georges. But the otc stock apears to be less risky and, when comparing its historical volatility, Oroco Resource Corp is 1.97 times less risky than St Georges. The otc stock trades about -0.07 of its potential returns per unit of risk. The St Georges Eco Mining Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  4.24  in St Georges Eco Mining Corp on September 17, 2024 and sell it today you would lose (0.34) from holding St Georges Eco Mining Corp or give up 8.02% of portfolio value over 90 days.

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

Oroco Resource Corp  vs.  St Georges Eco Mining Corp

Oroco Resource Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Oroco Resource Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's fundamental 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.

St Georges Eco

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in St Georges Eco Mining Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, St Georges may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Oroco Resource and St Georges

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

The idea behind Oroco Resource Corp and St Georges Eco Mining 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 Commodity Directory module to find actively traded commodities issued by global exchanges.