Correlation Between Taseko Mines and Q Gold

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

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

Diversification Opportunities for Taseko Mines and Q Gold

-0.71

Correlation Coefficient

Taseko Mines  Q Gold

Pay attention - limited upside

The 3 months correlation between Taseko and QGR is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Taseko Mines and Q Gold Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Q Gold Resources and Taseko Mines 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 Taseko Mines are associated (or correlated) with Q Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Q Gold Resources has no effect on the direction of Taseko Mines i.e., Taseko Mines and Q Gold go up and down completely randomly.

Pair Corralation between Taseko Mines and Q Gold

Assuming the 90 days trading horizon Taseko Mines is expected to generate 1.19 times less return on investment than Q Gold. But when comparing it to its historical volatility, Taseko Mines is 2.78 times less risky than Q Gold. It trades about 0.1 of its potential returns per unit of risk. Q Gold Resources is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  4.00  in Q Gold Resources on February 2, 2024 and sell it today you would earn a total of  0.00  from holding Q Gold Resources or generate 0.0% return on investment over 90 days.

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

Taseko Mines  vs.  Q Gold Resources

Taseko Mines

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Taseko Mines are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Taseko Mines displayed solid returns over the last few months and may actually be approaching a breakup point.

Q Gold Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Q Gold Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in June 2024. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Taseko Mines and Q Gold

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

The idea behind Taseko Mines and Q Gold Resources 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.