Correlation Between NioCorp Developments and Jaguar Mining
Can any of the company-specific risk be diversified away by investing in both NioCorp Developments and Jaguar 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 Jaguar 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 Jaguar Mining, you can compare the effects of market volatilities on NioCorp Developments and Jaguar 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 Jaguar Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of NioCorp Developments and Jaguar Mining.
Diversification Opportunities for NioCorp Developments and Jaguar Mining
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NioCorp and Jaguar is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding NioCorp Developments Ltd and Jaguar Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jaguar 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 Jaguar Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jaguar Mining has no effect on the direction of NioCorp Developments i.e., NioCorp Developments and Jaguar Mining go up and down completely randomly.
Pair Corralation between NioCorp Developments and Jaguar Mining
Allowing for the 90-day total investment horizon NioCorp Developments Ltd is expected to generate 0.7 times more return on investment than Jaguar Mining. However, NioCorp Developments Ltd is 1.44 times less risky than Jaguar Mining. It trades about -0.2 of its potential returns per unit of risk. Jaguar Mining is currently generating about -0.17 per unit of risk. If you would invest 149.00 in NioCorp Developments Ltd on September 3, 2024 and sell it today you would lose (16.00) from holding NioCorp Developments Ltd or give up 10.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NioCorp Developments Ltd vs. Jaguar Mining
Performance |
| Timeline |
| NioCorp Developments |
| Jaguar Mining |
NioCorp Developments and Jaguar Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NioCorp Developments and Jaguar Mining
The main advantage of trading using opposite NioCorp Developments and Jaguar Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NioCorp Developments position performs unexpectedly, Jaguar 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 Jaguar Mining will offset losses from the drop in Jaguar Mining's long position.| NioCorp Developments vs. Summit Materials | NioCorp Developments vs. Westrock Coffee | NioCorp Developments vs. Aldel Financial II | NioCorp Developments vs. Keurig Dr Pepper |
| Jaguar Mining vs. Sokoman Minerals Corp | Jaguar Mining vs. Irving Resources | Jaguar Mining vs. Lion One Metals | Jaguar Mining vs. Exploits Discovery 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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