Correlation Between Jindalee Resources and Québec Nickel
Can any of the company-specific risk be diversified away by investing in both Jindalee Resources and Québec Nickel 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 Jindalee Resources and Québec Nickel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jindalee Resources Limited and Qubec Nickel Corp, you can compare the effects of market volatilities on Jindalee Resources and Québec Nickel 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 Jindalee Resources with a short position of Québec Nickel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jindalee Resources and Québec Nickel.
Diversification Opportunities for Jindalee Resources and Québec Nickel
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jindalee and Québec is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Jindalee Resources Limited and Qubec Nickel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qubec Nickel Corp and Jindalee Resources 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 Jindalee Resources Limited are associated (or correlated) with Québec Nickel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qubec Nickel Corp has no effect on the direction of Jindalee Resources i.e., Jindalee Resources and Québec Nickel go up and down completely randomly.
Pair Corralation between Jindalee Resources and Québec Nickel
Assuming the 90 days horizon Jindalee Resources is expected to generate 10.97 times less return on investment than Québec Nickel. But when comparing it to its historical volatility, Jindalee Resources Limited is 3.93 times less risky than Québec Nickel. It trades about 0.05 of its potential returns per unit of risk. Qubec Nickel Corp is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1.75 in Qubec Nickel Corp on December 3, 2024 and sell it today you would earn a total of 4.69 from holding Qubec Nickel Corp or generate 268.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 93.75% |
| Values | Daily Returns |
Jindalee Resources Limited vs. Qubec Nickel Corp
Performance |
| Timeline |
| Jindalee Resources |
| Qubec Nickel Corp |
Jindalee Resources and Québec Nickel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jindalee Resources and Québec Nickel
The main advantage of trading using opposite Jindalee Resources and Québec Nickel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jindalee Resources position performs unexpectedly, Québec Nickel 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 Québec Nickel will offset losses from the drop in Québec Nickel's long position.| Jindalee Resources vs. BHP Group Limited | Jindalee Resources vs. Rio Tinto Group | Jindalee Resources vs. BHP Group Limited | Jindalee Resources vs. Rio Tinto Group |
| Québec Nickel vs. Norra Metals Corp | Québec Nickel vs. E79 Resources Corp | Québec Nickel vs. Voltage Metals Corp | Québec Nickel vs. Cantex Mine Development |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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