Correlation Between Equinox Gold and NXP Semiconductors
Can any of the company-specific risk be diversified away by investing in both Equinox Gold and NXP Semiconductors 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 Equinox Gold and NXP Semiconductors into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Equinox Gold Corp and NXP Semiconductors NV, you can compare the effects of market volatilities on Equinox Gold and NXP Semiconductors 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 Equinox Gold with a short position of NXP Semiconductors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equinox Gold and NXP Semiconductors.
Diversification Opportunities for Equinox Gold and NXP Semiconductors
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Equinox and NXP is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Equinox Gold Corp and NXP Semiconductors NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NXP Semiconductors and Equinox 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 Equinox Gold Corp are associated (or correlated) with NXP Semiconductors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NXP Semiconductors has no effect on the direction of Equinox Gold i.e., Equinox Gold and NXP Semiconductors go up and down completely randomly.
Pair Corralation between Equinox Gold and NXP Semiconductors
Assuming the 90 days trading horizon Equinox Gold Corp is expected to generate 2.37 times more return on investment than NXP Semiconductors. However, Equinox Gold is 2.37 times more volatile than NXP Semiconductors NV. It trades about 0.25 of its potential returns per unit of risk. NXP Semiconductors NV is currently generating about 0.12 per unit of risk. If you would invest 494.00 in Equinox Gold Corp on October 24, 2024 and sell it today you would earn a total of 78.00 from holding Equinox Gold Corp or generate 15.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Equinox Gold Corp vs. NXP Semiconductors NV
Performance |
| Timeline |
| Equinox Gold Corp |
| NXP Semiconductors |
Equinox Gold and NXP Semiconductors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Equinox Gold and NXP Semiconductors
The main advantage of trading using opposite Equinox Gold and NXP Semiconductors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equinox Gold position performs unexpectedly, NXP Semiconductors 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 NXP Semiconductors will offset losses from the drop in NXP Semiconductors' long position.| Equinox Gold vs. Cal Maine Foods | Equinox Gold vs. ADRIATIC METALS LS 013355 | Equinox Gold vs. EBRO FOODS | Equinox Gold vs. Calibre Mining Corp |
| NXP Semiconductors vs. Apple Inc | NXP Semiconductors vs. Apple Inc | NXP Semiconductors vs. Apple Inc | NXP Semiconductors vs. Apple Inc |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |