Correlation Between CompoSecure and Austin Gold

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

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

Diversification Opportunities for CompoSecure and Austin Gold

0.18

Correlation Coefficient

CompoSecure  Austin Gold

Average diversification

The 3 months correlation between CompoSecure and Austin is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding CompoSecure and Austin Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Austin Gold Corp and CompoSecure 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 CompoSecure are associated (or correlated) with Austin Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Austin Gold Corp has no effect on the direction of CompoSecure i.e., CompoSecure and Austin Gold go up and down completely randomly.

Pair Corralation between CompoSecure and Austin Gold

Assuming the 90 days horizon CompoSecure is expected to generate 1.55 times more return on investment than Austin Gold. However, CompoSecure is 1.55 times more volatile than Austin Gold Corp. It trades about 0.21 of its potential returns per unit of risk. Austin Gold Corp is currently generating about 0.05 per unit of risk. If you would invest  450.00  in CompoSecure on May 10, 2025 and sell it today you would earn a total of  498.00  from holding CompoSecure or generate 110.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

CompoSecure  vs.  Austin Gold Corp

CompoSecure

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in CompoSecure are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, CompoSecure showed solid returns over the last few months and may actually be approaching a breakup point.

Austin Gold Corp

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Austin Gold Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Austin Gold unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CompoSecure and Austin Gold

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

The idea behind CompoSecure and Austin Gold 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.