Correlation Between Liberty Gold and Nine Mile
Can any of the company-specific risk be diversified away by investing in both Liberty Gold and Nine Mile 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 Liberty Gold and Nine Mile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty Gold Corp and Nine Mile Metals, you can compare the effects of market volatilities on Liberty Gold and Nine Mile 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 Liberty Gold with a short position of Nine Mile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Gold and Nine Mile.
Diversification Opportunities for Liberty Gold and Nine Mile
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Liberty and Nine is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Gold Corp and Nine Mile Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nine Mile Metals and Liberty Gold 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 Liberty Gold Corp are associated (or correlated) with Nine Mile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nine Mile Metals has no effect on the direction of Liberty Gold i.e., Liberty Gold and Nine Mile go up and down completely randomly.
Pair Corralation between Liberty Gold and Nine Mile
Assuming the 90 days horizon Liberty Gold Corp is expected to generate 0.44 times more return on investment than Nine Mile. However, Liberty Gold Corp is 2.27 times less risky than Nine Mile. It trades about 0.01 of its potential returns per unit of risk. Nine Mile Metals is currently generating about -0.01 per unit of risk. If you would invest 24.00 in Liberty Gold Corp on August 29, 2024 and sell it today you would lose (3.00) from holding Liberty Gold Corp or give up 12.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Liberty Gold Corp vs. Nine Mile Metals
Performance |
| Timeline |
| Liberty Gold Corp |
| Nine Mile Metals |
Liberty Gold and Nine Mile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liberty Gold and Nine Mile
The main advantage of trading using opposite Liberty Gold and Nine Mile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty Gold position performs unexpectedly, Nine Mile 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 Nine Mile will offset losses from the drop in Nine Mile's long position.| Liberty Gold vs. Silver Hammer Mining | Liberty Gold vs. Reyna Silver Corp | Liberty Gold vs. Guanajuato Silver | Liberty Gold vs. Silver One Resources |
| Nine Mile vs. Endurance Gold | Nine Mile vs. Red Pine Exploration | Nine Mile vs. Altamira Gold Corp | Nine Mile vs. Grande Portage 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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