Correlation Between Nine Entertainment and Talisman Mining
Can any of the company-specific risk be diversified away by investing in both Nine Entertainment and Talisman 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 Nine Entertainment and Talisman Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nine Entertainment Co and Talisman Mining, you can compare the effects of market volatilities on Nine Entertainment and Talisman 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 Nine Entertainment with a short position of Talisman Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nine Entertainment and Talisman Mining.
Diversification Opportunities for Nine Entertainment and Talisman Mining
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nine and Talisman is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Nine Entertainment Co and Talisman Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Talisman Mining and Nine Entertainment 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 Nine Entertainment Co are associated (or correlated) with Talisman Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Talisman Mining has no effect on the direction of Nine Entertainment i.e., Nine Entertainment and Talisman Mining go up and down completely randomly.
Pair Corralation between Nine Entertainment and Talisman Mining
Assuming the 90 days trading horizon Nine Entertainment Co is expected to generate 0.39 times more return on investment than Talisman Mining. However, Nine Entertainment Co is 2.58 times less risky than Talisman Mining. It trades about 0.25 of its potential returns per unit of risk. Talisman Mining is currently generating about -0.11 per unit of risk. If you would invest 114.00 in Nine Entertainment Co on September 3, 2024 and sell it today you would earn a total of 11.00 from holding Nine Entertainment Co or generate 9.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nine Entertainment Co vs. Talisman Mining
Performance |
| Timeline |
| Nine Entertainment |
| Talisman Mining |
Nine Entertainment and Talisman Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nine Entertainment and Talisman Mining
The main advantage of trading using opposite Nine Entertainment and Talisman Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nine Entertainment position performs unexpectedly, Talisman 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 Talisman Mining will offset losses from the drop in Talisman Mining's long position.| Nine Entertainment vs. Encounter Resources | Nine Entertainment vs. Tlou Energy | Nine Entertainment vs. Superior Resources | Nine Entertainment vs. Peel Mining |
| Talisman Mining vs. Northern Star Resources | Talisman Mining vs. Evolution Mining | Talisman Mining vs. Bluescope Steel | Talisman Mining vs. Aneka Tambang Tbk |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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