Correlation Between Majestic Gold and Scorpio Gold

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

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

Diversification Opportunities for Majestic Gold and Scorpio Gold

0.0

Correlation Coefficient

Majestic Gold  Scorpio Gold

Pay attention - limited upside

The 3 months correlation between Majestic and Scorpio is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Majestic Gold Corp and Scorpio Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scorpio Gold Corp and Majestic 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 Majestic Gold Corp are associated (or correlated) with Scorpio Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scorpio Gold Corp has no effect on the direction of Majestic Gold i.e., Majestic Gold and Scorpio Gold go up and down completely randomly.

Pair Corralation between Majestic Gold and Scorpio Gold

If you would invest  9.13  in Majestic Gold Corp on May 5, 2025 and sell it today you would earn a total of  0.87  from holding Majestic Gold Corp or generate 9.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Majestic Gold Corp  vs.  Scorpio Gold Corp

Majestic Gold Corp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Majestic Gold Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal fundamental indicators, Majestic Gold reported solid returns over the last few months and may actually be approaching a breakup point.

Scorpio Gold Corp

Risk-Adjusted Performance

OK

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

Pair Trading with Majestic Gold and Scorpio Gold

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

The idea behind Majestic Gold Corp and Scorpio 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.

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 the Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.