Correlation Between Pacific Ridge and Critical Metals

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

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

Diversification Opportunities for Pacific Ridge and Critical Metals

0.0

Correlation Coefficient

Pacific Ridge  Critical Metals

Pay attention - limited upside

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

Pair Corralation between Pacific Ridge and Critical Metals

If you would invest  687.00  in Critical Metals Corp on August 26, 2025 and sell it today you would earn a total of  26.00  from holding Critical Metals Corp or generate 3.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Pacific Ridge Exploration  vs.  Critical Metals Corp

Pacific Ridge Exploration

Risk-Adjusted Performance

Soft

Over the last 90 days Pacific Ridge Exploration has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Pacific Ridge is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Critical Metals Corp

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Critical Metals Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile primary indicators, Critical Metals disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pacific Ridge and Critical Metals

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

The idea behind Pacific Ridge Exploration and Critical Metals 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.