Correlation Between High Liner and Nicola Mining
Can any of the company-specific risk be diversified away by investing in both High Liner and Nicola 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 High Liner and Nicola Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between High Liner Foods and Nicola Mining, you can compare the effects of market volatilities on High Liner and Nicola 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 High Liner with a short position of Nicola Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of High Liner and Nicola Mining.
Diversification Opportunities for High Liner and Nicola Mining
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between High and Nicola is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding High Liner Foods and Nicola Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nicola Mining and High Liner 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 High Liner Foods are associated (or correlated) with Nicola Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nicola Mining has no effect on the direction of High Liner i.e., High Liner and Nicola Mining go up and down completely randomly.
Pair Corralation between High Liner and Nicola Mining
Assuming the 90 days trading horizon High Liner is expected to generate 4.17 times less return on investment than Nicola Mining. But when comparing it to its historical volatility, High Liner Foods is 4.0 times less risky than Nicola Mining. It trades about 0.04 of its potential returns per unit of risk. Nicola Mining is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 22.00 in Nicola Mining on September 13, 2024 and sell it today you would earn a total of 6.00 from holding Nicola Mining or generate 27.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
High Liner Foods vs. Nicola Mining
Performance |
| Timeline |
| High Liner Foods |
| Nicola Mining |
High Liner and Nicola Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with High Liner and Nicola Mining
The main advantage of trading using opposite High Liner and Nicola Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if High Liner position performs unexpectedly, Nicola 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 Nicola Mining will offset losses from the drop in Nicola Mining's long position.| High Liner vs. Leons Furniture Limited | High Liner vs. Autocanada | High Liner vs. Maple Leaf Foods | High Liner vs. Premium Brands Holdings |
| Nicola Mining vs. Foraco International SA | Nicola Mining vs. Geodrill Limited | Nicola Mining vs. Major Drilling Group | Nicola Mining vs. Bri Chem Corp |
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 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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