Correlation Between GOLD LION and Ensign

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Can any of the company-specific risk be diversified away by investing in both GOLD LION and Ensign 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 GOLD LION and Ensign into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GOLD LION RESOURCES and The Ensign Group, you can compare the effects of market volatilities on GOLD LION and Ensign 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 GOLD LION with a short position of Ensign. Check out your portfolio center. Please also check ongoing floating volatility patterns of GOLD LION and Ensign.

Diversification Opportunities for GOLD LION and Ensign

  Correlation Coefficient

Good diversification

The 3 months correlation between GOLD and Ensign is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding GOLD LION RESOURCES and The Ensign Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ensign Group and GOLD LION 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 GOLD LION RESOURCES are associated (or correlated) with Ensign. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ensign Group has no effect on the direction of GOLD LION i.e., GOLD LION and Ensign go up and down completely randomly.

Pair Corralation between GOLD LION and Ensign

Assuming the 90 days horizon GOLD LION RESOURCES is expected to generate 100.6 times more return on investment than Ensign. However, GOLD LION is 100.6 times more volatile than The Ensign Group. It trades about 0.16 of its potential returns per unit of risk. The Ensign Group is currently generating about -0.03 per unit of risk. If you would invest  0.46  in GOLD LION RESOURCES on March 3, 2023 and sell it today you would earn a total of  3.39  from holding GOLD LION RESOURCES or generate 736.96% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
ValuesDaily Returns

GOLD LION RESOURCES  vs.  The Ensign Group

 Performance (%) 

GOLD Performance

1 of 100

Compared to the overall equity markets, risk-adjusted returns on investments in GOLD LION RESOURCES are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, GOLD LION reported solid returns over the last few months and may actually be approaching a breakup point.
Ensign Group 

Ensign Performance

0 of 100

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

GOLD LION and Ensign Volatility Contrast

   Predicted Return Density   

Pair Trading with GOLD LION and Ensign

The main advantage of trading using opposite GOLD LION and Ensign positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GOLD LION position performs unexpectedly, Ensign 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 Ensign will offset losses from the drop in Ensign's long position.
The idea behind GOLD LION RESOURCES and The Ensign Group 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.
Check out your portfolio center. 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..

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