Correlation Between Global Ferronickel and NiHAO Mineral
Can any of the company-specific risk be diversified away by investing in both Global Ferronickel 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 Global Ferronickel and NiHAO Mineral into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Ferronickel Holdings and NiHAO Mineral Resources, you can compare the effects of market volatilities on Global Ferronickel 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 Global Ferronickel with a short position of NiHAO Mineral. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Ferronickel and NiHAO Mineral.
Diversification Opportunities for Global Ferronickel and NiHAO Mineral
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Global and NiHAO is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Global Ferronickel Holdings 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 Global Ferronickel 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 Global Ferronickel Holdings 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 Global Ferronickel i.e., Global Ferronickel and NiHAO Mineral go up and down completely randomly.
Pair Corralation between Global Ferronickel and NiHAO Mineral
Assuming the 90 days trading horizon Global Ferronickel Holdings is expected to generate 0.34 times more return on investment than NiHAO Mineral. However, Global Ferronickel Holdings is 2.91 times less risky than NiHAO Mineral. It trades about -0.16 of its potential returns per unit of risk. NiHAO Mineral Resources is currently generating about -0.07 per unit of risk. If you would invest 142.00 in Global Ferronickel Holdings on September 20, 2024 and sell it today you would lose (30.00) from holding Global Ferronickel Holdings or give up 21.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 55.56% |
| Values | Daily Returns |
Global Ferronickel Holdings vs. NiHAO Mineral Resources
Performance |
| Timeline |
| Global Ferronickel |
| NiHAO Mineral Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Global Ferronickel and NiHAO Mineral Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Ferronickel and NiHAO Mineral
The main advantage of trading using opposite Global Ferronickel and NiHAO Mineral positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Ferronickel 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.| Global Ferronickel vs. Atok Big Wedge | Global Ferronickel vs. Philex Mining Corp | Global Ferronickel vs. Atlas Consolidated Mining | Global Ferronickel vs. Lepanto Consolidated Mining |
| NiHAO Mineral vs. Metropolitan Bank Trust | NiHAO Mineral vs. BDO Unibank | NiHAO Mineral vs. Concepcion Industrial Corp | 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |