Correlation Between NioCorp Developments and Adex Mining
Can any of the company-specific risk be diversified away by investing in both NioCorp Developments and Adex 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 NioCorp Developments and Adex Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NioCorp Developments Ltd and Adex Mining, you can compare the effects of market volatilities on NioCorp Developments and Adex 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 NioCorp Developments with a short position of Adex Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of NioCorp Developments and Adex Mining.
Diversification Opportunities for NioCorp Developments and Adex Mining
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NioCorp and Adex is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding NioCorp Developments Ltd and Adex Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adex Mining and NioCorp Developments 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 NioCorp Developments Ltd are associated (or correlated) with Adex Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adex Mining has no effect on the direction of NioCorp Developments i.e., NioCorp Developments and Adex Mining go up and down completely randomly.
Pair Corralation between NioCorp Developments and Adex Mining
Allowing for the 90-day total investment horizon NioCorp Developments is expected to generate 2.45 times less return on investment than Adex Mining. In addition to that, NioCorp Developments is 1.05 times more volatile than Adex Mining. It trades about 0.04 of its total potential returns per unit of risk. Adex Mining is currently generating about 0.1 per unit of volatility. If you would invest 0.21 in Adex Mining on September 2, 2024 and sell it today you would earn a total of 0.78 from holding Adex Mining or generate 371.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
NioCorp Developments Ltd vs. Adex Mining
Performance |
| Timeline |
| NioCorp Developments |
| Adex Mining |
NioCorp Developments and Adex Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NioCorp Developments and Adex Mining
The main advantage of trading using opposite NioCorp Developments and Adex Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NioCorp Developments position performs unexpectedly, Adex 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 Adex Mining will offset losses from the drop in Adex Mining's long position.| NioCorp Developments vs. Teck Resources Ltd | NioCorp Developments vs. Sigma Lithium Resources | NioCorp Developments vs. Vale SA ADR | NioCorp Developments vs. Sayona Mining Limited |
| Adex Mining vs. South32 Limited | Adex Mining vs. NioCorp Developments Ltd | Adex Mining vs. HUMANA INC | Adex Mining 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |