Correlation Between Tudor Gold and Exploits Discovery

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

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

Diversification Opportunities for Tudor Gold and Exploits Discovery

0.54

Correlation Coefficient

Tudor Gold  Exploits Discovery

Very weak diversification

The 3 months correlation between Tudor and Exploits is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Tudor Gold Corp and Exploits Discovery Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exploits Discovery Corp and Tudor 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 Tudor Gold Corp are associated (or correlated) with Exploits Discovery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exploits Discovery Corp has no effect on the direction of Tudor Gold i.e., Tudor Gold and Exploits Discovery go up and down completely randomly.

Pair Corralation between Tudor Gold and Exploits Discovery

Assuming the 90 days horizon Tudor Gold Corp is expected to generate 0.83 times more return on investment than Exploits Discovery. However, Tudor Gold Corp is 1.2 times less risky than Exploits Discovery. It trades about 0.02 of its potential returns per unit of risk. Exploits Discovery Corp is currently generating about -0.07 per unit of risk. If you would invest  60.00  in Tudor Gold Corp on September 4, 2024 and sell it today you would earn a total of  0.00  from holding Tudor Gold Corp or generate 0.0% return on investment over 90 days.

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

Tudor Gold Corp  vs.  Exploits Discovery Corp

Tudor Gold Corp

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Tudor Gold Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Tudor Gold is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Exploits Discovery Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Exploits Discovery Corp 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 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.

Pair Trading with Tudor Gold and Exploits Discovery

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

The idea behind Tudor Gold Corp and Exploits Discovery 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.