Correlation Between Newcrest Mining and Nine Mile
Can any of the company-specific risk be diversified away by investing in both Newcrest Mining and Nine Mile 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 Newcrest Mining and Nine Mile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Newcrest Mining and Nine Mile Metals, you can compare the effects of market volatilities on Newcrest Mining and Nine Mile 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 Newcrest Mining with a short position of Nine Mile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newcrest Mining and Nine Mile.
Diversification Opportunities for Newcrest Mining and Nine Mile
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Newcrest and Nine is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Newcrest Mining and Nine Mile Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nine Mile Metals and Newcrest Mining 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 Newcrest Mining are associated (or correlated) with Nine Mile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nine Mile Metals has no effect on the direction of Newcrest Mining i.e., Newcrest Mining and Nine Mile go up and down completely randomly.
Pair Corralation between Newcrest Mining and Nine Mile
If you would invest 4.39 in Nine Mile Metals on September 1, 2024 and sell it today you would lose (2.21) from holding Nine Mile Metals or give up 50.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.37% |
| Values | Daily Returns |
Newcrest Mining vs. Nine Mile Metals
Performance |
| Timeline |
| Newcrest Mining |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Nine Mile Metals |
Newcrest Mining and Nine Mile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newcrest Mining and Nine Mile
The main advantage of trading using opposite Newcrest Mining and Nine Mile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newcrest Mining position performs unexpectedly, Nine Mile 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 Nine Mile will offset losses from the drop in Nine Mile's long position.| Newcrest Mining vs. Big Ridge Gold | Newcrest Mining vs. Westhaven Gold Corp | Newcrest Mining vs. Satori Resources | Newcrest Mining vs. K92 Mining |
| Nine Mile vs. Aurion Resources | Nine Mile vs. Rio2 Limited | Nine Mile vs. Palamina Corp | Nine Mile vs. BTU Metals 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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