Correlation Between EMX Royalty and Fury Gold

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

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

Diversification Opportunities for EMX Royalty and Fury Gold

0.9

Correlation Coefficient

EMX Royalty  Fury Gold

Almost no diversification

The 3 months correlation between EMX and Fury is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding EMX Royalty Corp and Fury Gold Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fury Gold Mines and EMX Royalty 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 EMX Royalty Corp are associated (or correlated) with Fury Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fury Gold Mines has no effect on the direction of EMX Royalty i.e., EMX Royalty and Fury Gold go up and down completely randomly.

Pair Corralation between EMX Royalty and Fury Gold

Considering the 90-day investment horizon EMX Royalty Corp is expected to generate 0.64 times more return on investment than Fury Gold. However, EMX Royalty Corp is 1.56 times less risky than Fury Gold. It trades about 0.01 of its potential returns per unit of risk. Fury Gold Mines is currently generating about 0.01 per unit of risk. If you would invest  175.00  in EMX Royalty Corp on August 27, 2024 and sell it today you would earn a total of  0.00  from holding EMX Royalty Corp or generate 0.0% return on investment over 90 days.

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

EMX Royalty Corp  vs.  Fury Gold Mines

EMX Royalty Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EMX Royalty Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong primary indicators, EMX Royalty is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Fury Gold Mines

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Fury Gold Mines has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Fury Gold is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with EMX Royalty and Fury Gold

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

The idea behind EMX Royalty Corp and Fury Gold Mines 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.