Correlation Between Aya Gold and NGEx Minerals
Can any of the company-specific risk be diversified away by investing in both Aya Gold and NGEx Minerals 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 Aya Gold and NGEx Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aya Gold Silver and NGEx Minerals, you can compare the effects of market volatilities on Aya Gold and NGEx Minerals 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 Aya Gold with a short position of NGEx Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aya Gold and NGEx Minerals.
Diversification Opportunities for Aya Gold and NGEx Minerals
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aya and NGEx is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Aya Gold Silver and NGEx Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NGEx Minerals and Aya 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 Aya Gold Silver are associated (or correlated) with NGEx Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NGEx Minerals has no effect on the direction of Aya Gold i.e., Aya Gold and NGEx Minerals go up and down completely randomly.
Pair Corralation between Aya Gold and NGEx Minerals
Assuming the 90 days trading horizon Aya Gold Silver is expected to generate 1.66 times more return on investment than NGEx Minerals. However, Aya Gold is 1.66 times more volatile than NGEx Minerals. It trades about -0.03 of its potential returns per unit of risk. NGEx Minerals is currently generating about -0.17 per unit of risk. If you would invest 1,207 in Aya Gold Silver on January 13, 2025 and sell it today you would lose (87.00) from holding Aya Gold Silver or give up 7.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aya Gold Silver vs. NGEx Minerals
Performance |
| Timeline |
| Aya Gold Silver |
| NGEx Minerals |
Aya Gold and NGEx Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aya Gold and NGEx Minerals
The main advantage of trading using opposite Aya Gold and NGEx Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aya Gold position performs unexpectedly, NGEx Minerals 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 NGEx Minerals will offset losses from the drop in NGEx Minerals' long position.The idea behind Aya Gold Silver and NGEx Minerals 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.| NGEx Minerals vs. Teck Resources Limited | NGEx Minerals vs. Ivanhoe Mines | NGEx Minerals vs. Calibre Mining Corp | NGEx Minerals vs. Skeena Resources |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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