Correlation Between Orezone Gold and Ecora Resources

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

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

Diversification Opportunities for Orezone Gold and Ecora Resources

0.85

Correlation Coefficient

Orezone Gold  Ecora Resources

Very poor diversification

The 3 months correlation between Orezone and Ecora is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Orezone Gold Corp and Ecora Resources plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ecora Resources plc and Orezone 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 Orezone Gold Corp are associated (or correlated) with Ecora Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ecora Resources plc has no effect on the direction of Orezone Gold i.e., Orezone Gold and Ecora Resources go up and down completely randomly.

Pair Corralation between Orezone Gold and Ecora Resources

Assuming the 90 days trading horizon Orezone Gold Corp is expected to generate 1.3 times more return on investment than Ecora Resources. However, Orezone Gold is 1.3 times more volatile than Ecora Resources plc. It trades about 0.12 of its potential returns per unit of risk. Ecora Resources plc is currently generating about 0.11 per unit of risk. If you would invest  114.00  in Orezone Gold Corp on July 25, 2025 and sell it today you would earn a total of  31.00  from holding Orezone Gold Corp or generate 27.19% return on investment over 90 days.

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

Orezone Gold Corp  vs.  Ecora Resources plc

Orezone Gold Corp

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Orezone Gold Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal technical and fundamental indicators, Orezone Gold displayed solid returns over the last few months and may actually be approaching a breakup point.

Ecora Resources plc

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Ecora Resources plc are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, Ecora Resources displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Orezone Gold and Ecora Resources

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

The idea behind Orezone Gold Corp and Ecora Resources plc 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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.