Correlation Between Themac Resources and Nicola Mining
Can any of the company-specific risk be diversified away by investing in both Themac Resources 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 Themac Resources and Nicola Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Themac Resources Group and Nicola Mining, you can compare the effects of market volatilities on Themac Resources 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 Themac Resources with a short position of Nicola Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Themac Resources and Nicola Mining.
Diversification Opportunities for Themac Resources and Nicola Mining
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Themac and Nicola is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Themac Resources Group and Nicola Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nicola Mining and Themac 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 Themac Resources Group 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 Themac Resources i.e., Themac Resources and Nicola Mining go up and down completely randomly.
Pair Corralation between Themac Resources and Nicola Mining
Assuming the 90 days horizon Themac Resources Group is expected to generate 1.32 times more return on investment than Nicola Mining. However, Themac Resources is 1.32 times more volatile than Nicola Mining. It trades about 0.05 of its potential returns per unit of risk. Nicola Mining is currently generating about 0.02 per unit of risk. If you would invest 2.50 in Themac Resources Group on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Themac Resources Group or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Themac Resources Group vs. Nicola Mining
Performance |
| Timeline |
| Themac Resources |
| Nicola Mining |
Themac Resources and Nicola Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Themac Resources and Nicola Mining
The main advantage of trading using opposite Themac Resources and Nicola Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Themac Resources 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.| Themac Resources vs. East Side Games | Themac Resources vs. Canlan Ice Sports | Themac Resources vs. Solid Impact Investments | Themac Resources vs. Primaris Retail RE |
| Nicola Mining vs. First Majestic Silver | Nicola Mining vs. Ivanhoe Energy | Nicola Mining vs. Orezone Gold Corp | Nicola Mining vs. Faraday Copper 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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