Correlation Between NioCorp Developments and Cascades
Can any of the company-specific risk be diversified away by investing in both NioCorp Developments and Cascades 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 Cascades 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 Cascades, you can compare the effects of market volatilities on NioCorp Developments and Cascades 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 Cascades. Check out your portfolio center. Please also check ongoing floating volatility patterns of NioCorp Developments and Cascades.
Diversification Opportunities for NioCorp Developments and Cascades
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NioCorp and Cascades is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding NioCorp Developments Ltd and Cascades in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cascades 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 Cascades. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cascades has no effect on the direction of NioCorp Developments i.e., NioCorp Developments and Cascades go up and down completely randomly.
Pair Corralation between NioCorp Developments and Cascades
Allowing for the 90-day total investment horizon NioCorp Developments Ltd is expected to under-perform the Cascades. In addition to that, NioCorp Developments is 1.88 times more volatile than Cascades. It trades about -0.05 of its total potential returns per unit of risk. Cascades is currently generating about 0.01 per unit of volatility. If you would invest 860.00 in Cascades on September 3, 2024 and sell it today you would lose (17.00) from holding Cascades or give up 1.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 78.54% |
| Values | Daily Returns |
NioCorp Developments Ltd vs. Cascades
Performance |
| Timeline |
| NioCorp Developments |
| Cascades |
NioCorp Developments and Cascades Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NioCorp Developments and Cascades
The main advantage of trading using opposite NioCorp Developments and Cascades positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NioCorp Developments position performs unexpectedly, Cascades 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 Cascades will offset losses from the drop in Cascades' long position.| NioCorp Developments vs. Summit Materials | NioCorp Developments vs. Westrock Coffee | NioCorp Developments vs. Aldel Financial II | NioCorp Developments vs. Keurig Dr Pepper |
| Cascades vs. TriMas | Cascades vs. Myers Industries | Cascades vs. Reynolds Consumer Products | Cascades vs. Pactiv Evergreen |
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.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |