Correlation Between North Bay and Prom Resources
Can any of the company-specific risk be diversified away by investing in both North Bay and Prom Resources 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 North Bay and Prom Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between North Bay Resources and Prom Resources, you can compare the effects of market volatilities on North Bay and Prom Resources 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 North Bay with a short position of Prom Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of North Bay and Prom Resources.
Diversification Opportunities for North Bay and Prom Resources
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between North and Prom is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding North Bay Resources and Prom Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prom Resources and North Bay 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 North Bay Resources are associated (or correlated) with Prom Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prom Resources has no effect on the direction of North Bay i.e., North Bay and Prom Resources go up and down completely randomly.
Pair Corralation between North Bay and Prom Resources
If you would invest 0.03 in North Bay Resources on September 1, 2024 and sell it today you would earn a total of 0.06 from holding North Bay Resources or generate 200.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.78% |
| Values | Daily Returns |
North Bay Resources vs. Prom Resources
Performance |
| Timeline |
| North Bay Resources |
| Prom Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
North Bay and Prom Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with North Bay and Prom Resources
The main advantage of trading using opposite North Bay and Prom Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if North Bay position performs unexpectedly, Prom Resources 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 Prom Resources will offset losses from the drop in Prom Resources' long position.| North Bay vs. Defiance Silver Corp | North Bay vs. HUMANA INC | North Bay vs. SCOR PK | North Bay vs. Aquagold International |
| Prom Resources vs. Grillit | Prom Resources vs. ZA Group | Prom Resources vs. Blue Water Global | Prom Resources vs. BJs Restaurants |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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