Correlation Between K9 Gold and Goldex Resources

Can any of the company-specific risk be diversified away by investing in both K9 Gold and Goldex 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 K9 Gold and Goldex Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between K9 Gold Corp and Goldex Resources, you can compare the effects of market volatilities on K9 Gold and Goldex 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 K9 Gold with a short position of Goldex Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of K9 Gold and Goldex Resources.

Diversification Opportunities for K9 Gold and Goldex Resources

0.01

Correlation Coefficient

K9 Gold  Goldex Resources

Significant diversification

The 3 months correlation between WDFCF and Goldex is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding K9 Gold Corp and Goldex Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldex Resources and K9 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 K9 Gold Corp are associated (or correlated) with Goldex Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldex Resources has no effect on the direction of K9 Gold i.e., K9 Gold and Goldex Resources go up and down completely randomly.

Pair Corralation between K9 Gold and Goldex Resources

Assuming the 90 days horizon K9 Gold Corp is expected to generate 1.08 times more return on investment than Goldex Resources. However, K9 Gold is 1.08 times more volatile than Goldex Resources. It trades about 0.12 of its potential returns per unit of risk. Goldex Resources is currently generating about 0.05 per unit of risk. If you would invest  7.00  in K9 Gold Corp on May 9, 2025 and sell it today you would earn a total of  3.00  from holding K9 Gold Corp or generate 42.86% return on investment over 90 days.

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

K9 Gold Corp  vs.  Goldex Resources

K9 Gold Corp

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in K9 Gold Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental indicators, K9 Gold reported solid returns over the last few months and may actually be approaching a breakup point.

Goldex Resources

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Goldex Resources are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Goldex Resources reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with K9 Gold and Goldex Resources

The main advantage of trading using opposite K9 Gold and Goldex Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if K9 Gold position performs unexpectedly, Goldex 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 Goldex Resources will offset losses from the drop in Goldex Resources' long position.

The idea behind K9 Gold Corp and Goldex Resources 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.