Correlation Between Mechanics Bank and Nickel Creek
Can any of the company-specific risk be diversified away by investing in both Mechanics Bank and Nickel Creek 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 Mechanics Bank and Nickel Creek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mechanics Bank and Nickel Creek Platinum, you can compare the effects of market volatilities on Mechanics Bank and Nickel Creek 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 Mechanics Bank with a short position of Nickel Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mechanics Bank and Nickel Creek.
Diversification Opportunities for Mechanics Bank and Nickel Creek
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mechanics and Nickel is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Mechanics Bank and Nickel Creek Platinum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nickel Creek Platinum and Mechanics Bank 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 Mechanics Bank are associated (or correlated) with Nickel Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nickel Creek Platinum has no effect on the direction of Mechanics Bank i.e., Mechanics Bank and Nickel Creek go up and down completely randomly.
Pair Corralation between Mechanics Bank and Nickel Creek
If you would invest 56.00 in Nickel Creek Platinum on September 1, 2024 and sell it today you would earn a total of 1.00 from holding Nickel Creek Platinum or generate 1.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Mechanics Bank vs. Nickel Creek Platinum
Performance |
| Timeline |
| Mechanics Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Nickel Creek Platinum |
Mechanics Bank and Nickel Creek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mechanics Bank and Nickel Creek
The main advantage of trading using opposite Mechanics Bank and Nickel Creek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mechanics Bank position performs unexpectedly, Nickel Creek 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 Nickel Creek will offset losses from the drop in Nickel Creek's long position.| Mechanics Bank vs. Merchants Marine Bancorp | Mechanics Bank vs. MNB Holdings Corp | Mechanics Bank vs. Oconee Financial | Mechanics Bank vs. Harbor Bankshares |
| Nickel Creek vs. South32 Limited | Nickel Creek vs. NioCorp Developments Ltd | Nickel Creek vs. HUMANA INC | Nickel Creek vs. SCOR PK |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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