Correlation Between NioCorp Developments and Juniata Valley
Can any of the company-specific risk be diversified away by investing in both NioCorp Developments and Juniata Valley 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 Juniata Valley 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 Juniata Valley Financial, you can compare the effects of market volatilities on NioCorp Developments and Juniata Valley 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 Juniata Valley. Check out your portfolio center. Please also check ongoing floating volatility patterns of NioCorp Developments and Juniata Valley.
Diversification Opportunities for NioCorp Developments and Juniata Valley
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NioCorp and Juniata is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding NioCorp Developments Ltd and Juniata Valley Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Juniata Valley Financial 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 Juniata Valley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Juniata Valley Financial has no effect on the direction of NioCorp Developments i.e., NioCorp Developments and Juniata Valley go up and down completely randomly.
Pair Corralation between NioCorp Developments and Juniata Valley
Allowing for the 90-day total investment horizon NioCorp Developments Ltd is expected to generate 7.81 times more return on investment than Juniata Valley. However, NioCorp Developments is 7.81 times more volatile than Juniata Valley Financial. It trades about 0.04 of its potential returns per unit of risk. Juniata Valley Financial is currently generating about 0.02 per unit of risk. If you would invest 98.00 in NioCorp Developments Ltd on August 27, 2024 and sell it today you would earn a total of 41.00 from holding NioCorp Developments Ltd or generate 41.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 88.57% |
| Values | Daily Returns |
NioCorp Developments Ltd vs. Juniata Valley Financial
Performance |
| Timeline |
| NioCorp Developments |
| Juniata Valley Financial |
NioCorp Developments and Juniata Valley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NioCorp Developments and Juniata Valley
The main advantage of trading using opposite NioCorp Developments and Juniata Valley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NioCorp Developments position performs unexpectedly, Juniata Valley 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 Juniata Valley will offset losses from the drop in Juniata Valley's long position.| NioCorp Developments vs. Vale SA ADR | NioCorp Developments vs. Teck Resources Ltd | NioCorp Developments vs. BHP Group Limited | NioCorp Developments vs. Glencore PLC ADR |
| Juniata Valley vs. Invesco High Income | Juniata Valley vs. Blackrock Muniholdings Ny | Juniata Valley vs. MFS Investment Grade | Juniata Valley vs. Federated Premier Municipal |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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