Correlation Between Glencore PLC and NGEx Minerals

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Can any of the company-specific risk be diversified away by investing in both Glencore PLC and NGEx Minerals 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 Glencore PLC and NGEx Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glencore PLC ADR and NGEx Minerals, you can compare the effects of market volatilities on Glencore PLC and NGEx Minerals 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 Glencore PLC with a short position of NGEx Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glencore PLC and NGEx Minerals.

Diversification Opportunities for Glencore PLC and NGEx Minerals

GlencoreNGExDiversified AwayGlencoreNGExDiversified Away100%
-0.3
  Correlation Coefficient

Very good diversification

The 3 months correlation between Glencore and NGEx is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Glencore PLC ADR and NGEx Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NGEx Minerals and Glencore PLC 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 Glencore PLC ADR are associated (or correlated) with NGEx Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NGEx Minerals has no effect on the direction of Glencore PLC i.e., Glencore PLC and NGEx Minerals go up and down completely randomly.

Pair Corralation between Glencore PLC and NGEx Minerals

Assuming the 90 days horizon Glencore PLC ADR is expected to under-perform the NGEx Minerals. But the pink sheet apears to be less risky and, when comparing its historical volatility, Glencore PLC ADR is 1.07 times less risky than NGEx Minerals. The pink sheet trades about -0.19 of its potential returns per unit of risk. The NGEx Minerals is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  902.00  in NGEx Minerals on December 2, 2024 and sell it today you would earn a total of  57.00  from holding NGEx Minerals or generate 6.32% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Glencore PLC ADR  vs.  NGEx Minerals

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -15-10-50510
JavaScript chart by amCharts 3.21.15GLNCY NGXXF
       Timeline  
Glencore PLC ADR 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Glencore PLC ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15JanFebFebMar88.599.510
NGEx Minerals 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in NGEx Minerals are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, NGEx Minerals is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15JanFebFebMar99.51010.511

Glencore PLC and NGEx Minerals Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.14-2.35-1.56-0.770.01130.681.352.032.7 0.060.070.080.090.100.110.12
JavaScript chart by amCharts 3.21.15GLNCY NGXXF
       Returns  

Pair Trading with Glencore PLC and NGEx Minerals

The main advantage of trading using opposite Glencore PLC and NGEx Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glencore PLC position performs unexpectedly, NGEx Minerals 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 NGEx Minerals will offset losses from the drop in NGEx Minerals' long position.
The idea behind Glencore PLC ADR and NGEx Minerals pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.

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