Correlation Between Ngx Energy and Emerita Resources
Can any of the company-specific risk be diversified away by investing in both Ngx Energy and Emerita Resources 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 Ngx Energy and Emerita Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ngx Energy International and Emerita Resources Corp, you can compare the effects of market volatilities on Ngx Energy and Emerita Resources 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 Ngx Energy with a short position of Emerita Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ngx Energy and Emerita Resources.
Diversification Opportunities for Ngx Energy and Emerita Resources
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ngx and Emerita is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Ngx Energy International and Emerita Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerita Resources Corp and Ngx Energy 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 Ngx Energy International are associated (or correlated) with Emerita Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerita Resources Corp has no effect on the direction of Ngx Energy i.e., Ngx Energy and Emerita Resources go up and down completely randomly.
Pair Corralation between Ngx Energy and Emerita Resources
Assuming the 90 days trading horizon Ngx Energy International is expected to generate 0.65 times more return on investment than Emerita Resources. However, Ngx Energy International is 1.54 times less risky than Emerita Resources. It trades about 0.0 of its potential returns per unit of risk. Emerita Resources Corp is currently generating about -0.01 per unit of risk. If you would invest 86.00 in Ngx Energy International on January 11, 2025 and sell it today you would lose (1.00) from holding Ngx Energy International or give up 1.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ngx Energy International vs. Emerita Resources Corp
Performance |
| Timeline |
| Ngx Energy International |
| Emerita Resources Corp |
Ngx Energy and Emerita Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ngx Energy and Emerita Resources
The main advantage of trading using opposite Ngx Energy and Emerita Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ngx Energy position performs unexpectedly, Emerita Resources 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 Emerita Resources will offset losses from the drop in Emerita Resources' long position.| Ngx Energy vs. Pine Cliff Energy | Ngx Energy vs. InPlay Oil Corp | Ngx Energy vs. Journey Energy | Ngx Energy vs. iShares Canadian HYBrid |
| Emerita Resources vs. Colonial Coal International | Emerita Resources vs. Banyan Gold Corp | Emerita Resources vs. Altiplano Metals | Emerita Resources vs. Copper Lake 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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