Correlation Between Ceylon Graphite and Nickel Creek
Can any of the company-specific risk be diversified away by investing in both Ceylon Graphite and Nickel Creek 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 Ceylon Graphite and Nickel Creek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ceylon Graphite Corp and Nickel Creek Platinum, you can compare the effects of market volatilities on Ceylon Graphite and Nickel Creek 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 Ceylon Graphite with a short position of Nickel Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceylon Graphite and Nickel Creek.
Diversification Opportunities for Ceylon Graphite and Nickel Creek
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ceylon and Nickel is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Ceylon Graphite Corp and Nickel Creek Platinum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nickel Creek Platinum and Ceylon Graphite 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 Ceylon Graphite Corp are associated (or correlated) with Nickel Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nickel Creek Platinum has no effect on the direction of Ceylon Graphite i.e., Ceylon Graphite and Nickel Creek go up and down completely randomly.
Pair Corralation between Ceylon Graphite and Nickel Creek
Assuming the 90 days horizon Ceylon Graphite Corp is expected to under-perform the Nickel Creek. In addition to that, Ceylon Graphite is 2.4 times more volatile than Nickel Creek Platinum. It trades about -0.07 of its total potential returns per unit of risk. Nickel Creek Platinum is currently generating about 0.02 per unit of volatility. If you would invest 55.00 in Nickel Creek Platinum on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Nickel Creek Platinum or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ceylon Graphite Corp vs. Nickel Creek Platinum
Performance |
| Timeline |
| Ceylon Graphite Corp |
| Nickel Creek Platinum |
Ceylon Graphite and Nickel Creek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ceylon Graphite and Nickel Creek
The main advantage of trading using opposite Ceylon Graphite and Nickel Creek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceylon Graphite position performs unexpectedly, Nickel Creek 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 Nickel Creek will offset losses from the drop in Nickel Creek's long position.| Ceylon Graphite vs. Argent Minerals Limited | Ceylon Graphite vs. Edison Cobalt Corp | Ceylon Graphite vs. Champion Bear Resources | Ceylon Graphite vs. Ascendant Resources |
| Nickel Creek vs. Ridgestone Mining | Nickel Creek vs. Focus Graphite | Nickel Creek vs. Jervois Mining | Nickel Creek vs. Altius Minerals |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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