Correlation Between Apex Mining and NiHAO Mineral
Can any of the company-specific risk be diversified away by investing in both Apex Mining and NiHAO Mineral 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 Apex Mining and NiHAO Mineral into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apex Mining Co and NiHAO Mineral Resources, you can compare the effects of market volatilities on Apex Mining and NiHAO Mineral 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 Apex Mining with a short position of NiHAO Mineral. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apex Mining and NiHAO Mineral.
Diversification Opportunities for Apex Mining and NiHAO Mineral
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Apex and NiHAO is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Apex Mining Co and NiHAO Mineral Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NiHAO Mineral Resources and Apex Mining 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 Apex Mining Co are associated (or correlated) with NiHAO Mineral. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NiHAO Mineral Resources has no effect on the direction of Apex Mining i.e., Apex Mining and NiHAO Mineral go up and down completely randomly.
Pair Corralation between Apex Mining and NiHAO Mineral
Assuming the 90 days trading horizon Apex Mining Co is expected to generate 0.34 times more return on investment than NiHAO Mineral. However, Apex Mining Co is 2.96 times less risky than NiHAO Mineral. It trades about -0.04 of its potential returns per unit of risk. NiHAO Mineral Resources is currently generating about -0.09 per unit of risk. If you would invest 391.00 in Apex Mining Co on September 19, 2024 and sell it today you would lose (47.00) from holding Apex Mining Co or give up 12.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 65.32% |
| Values | Daily Returns |
Apex Mining Co vs. NiHAO Mineral Resources
Performance |
| Timeline |
| Apex Mining |
| NiHAO Mineral Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Apex Mining and NiHAO Mineral Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apex Mining and NiHAO Mineral
The main advantage of trading using opposite Apex Mining and NiHAO Mineral positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apex Mining position performs unexpectedly, NiHAO Mineral 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 NiHAO Mineral will offset losses from the drop in NiHAO Mineral's long position.| Apex Mining vs. Atok Big Wedge | Apex Mining vs. Philex Mining Corp | Apex Mining vs. Atlas Consolidated Mining | Apex Mining vs. Lepanto Consolidated Mining |
| NiHAO Mineral vs. Atok Big Wedge | NiHAO Mineral vs. Philex Mining Corp | NiHAO Mineral vs. Atlas Consolidated Mining | NiHAO Mineral vs. Lepanto Consolidated Mining |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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