Correlation Between First Mining and Nine Mile
Can any of the company-specific risk be diversified away by investing in both First Mining and Nine Mile 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 First Mining and Nine Mile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Mining Gold and Nine Mile Metals, you can compare the effects of market volatilities on First Mining and Nine Mile 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 First Mining with a short position of Nine Mile. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Mining and Nine Mile.
Diversification Opportunities for First Mining and Nine Mile
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between First and Nine is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding First Mining Gold and Nine Mile Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nine Mile Metals and First 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 First Mining Gold are associated (or correlated) with Nine Mile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nine Mile Metals has no effect on the direction of First Mining i.e., First Mining and Nine Mile go up and down completely randomly.
Pair Corralation between First Mining and Nine Mile
Assuming the 90 days horizon First Mining is expected to generate 2.12 times less return on investment than Nine Mile. But when comparing it to its historical volatility, First Mining Gold is 2.14 times less risky than Nine Mile. It trades about 0.0 of its potential returns per unit of risk. Nine Mile Metals is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 22.00 in Nine Mile Metals on September 3, 2024 and sell it today you would lose (19.82) from holding Nine Mile Metals or give up 90.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Mining Gold vs. Nine Mile Metals
Performance |
| Timeline |
| First Mining Gold |
| Nine Mile Metals |
First Mining and Nine Mile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Mining and Nine Mile
The main advantage of trading using opposite First Mining and Nine Mile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Mining position performs unexpectedly, Nine Mile 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 Nine Mile will offset losses from the drop in Nine Mile's long position.| First Mining vs. Aurion Resources | First Mining vs. Orezone Gold Corp | First Mining vs. Rio2 Limited | First Mining vs. Norsemont Mining |
| Nine Mile vs. Harmony Gold Mining | Nine Mile vs. SPACE | Nine Mile vs. T Rowe Price | Nine Mile vs. Ampleforth |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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