Correlation Between Eddy Smart and NeXGold Mining
Can any of the company-specific risk be diversified away by investing in both Eddy Smart and NeXGold Mining 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 Eddy Smart and NeXGold Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eddy Smart Home and NeXGold Mining Corp, you can compare the effects of market volatilities on Eddy Smart and NeXGold Mining 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 Eddy Smart with a short position of NeXGold Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eddy Smart and NeXGold Mining.
Diversification Opportunities for Eddy Smart and NeXGold Mining
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Eddy and NeXGold is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Eddy Smart Home and NeXGold Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NeXGold Mining Corp and Eddy Smart 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 Eddy Smart Home are associated (or correlated) with NeXGold Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NeXGold Mining Corp has no effect on the direction of Eddy Smart i.e., Eddy Smart and NeXGold Mining go up and down completely randomly.
Pair Corralation between Eddy Smart and NeXGold Mining
Assuming the 90 days horizon Eddy Smart Home is expected to generate 4.41 times more return on investment than NeXGold Mining. However, Eddy Smart is 4.41 times more volatile than NeXGold Mining Corp. It trades about 0.08 of its potential returns per unit of risk. NeXGold Mining Corp is currently generating about 0.02 per unit of risk. If you would invest 200.00 in Eddy Smart Home on September 2, 2024 and sell it today you would earn a total of 55.00 from holding Eddy Smart Home or generate 27.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eddy Smart Home vs. NeXGold Mining Corp
Performance |
| Timeline |
| Eddy Smart Home |
| NeXGold Mining Corp |
Eddy Smart and NeXGold Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eddy Smart and NeXGold Mining
The main advantage of trading using opposite Eddy Smart and NeXGold Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eddy Smart position performs unexpectedly, NeXGold Mining 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 NeXGold Mining will offset losses from the drop in NeXGold Mining's long position.| Eddy Smart vs. Simply Better Brands | Eddy Smart vs. Forward Water Technologies | Eddy Smart vs. iShares Canadian HYBrid | Eddy Smart vs. Altagas Cum Red |
| NeXGold Mining vs. Royal Bank of | NeXGold Mining vs. Canso Credit Trust | NeXGold Mining vs. CI Financial Corp | NeXGold Mining vs. Olympia Financial Group |
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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