Correlation Between NeXGold Mining and Canfor
Can any of the company-specific risk be diversified away by investing in both NeXGold Mining and Canfor 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 NeXGold Mining and Canfor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NeXGold Mining Corp and Canfor, you can compare the effects of market volatilities on NeXGold Mining and Canfor 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 NeXGold Mining with a short position of Canfor. Check out your portfolio center. Please also check ongoing floating volatility patterns of NeXGold Mining and Canfor.
Diversification Opportunities for NeXGold Mining and Canfor
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between NeXGold and Canfor is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding NeXGold Mining Corp and Canfor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canfor and NeXGold 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 NeXGold Mining Corp are associated (or correlated) with Canfor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canfor has no effect on the direction of NeXGold Mining i.e., NeXGold Mining and Canfor go up and down completely randomly.
Pair Corralation between NeXGold Mining and Canfor
Assuming the 90 days trading horizon NeXGold Mining Corp is expected to generate 1.29 times more return on investment than Canfor. However, NeXGold Mining is 1.29 times more volatile than Canfor. It trades about -0.12 of its potential returns per unit of risk. Canfor is currently generating about -0.2 per unit of risk. If you would invest 76.00 in NeXGold Mining Corp on October 14, 2024 and sell it today you would lose (4.00) from holding NeXGold Mining Corp or give up 5.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NeXGold Mining Corp vs. Canfor
Performance |
| Timeline |
| NeXGold Mining Corp |
| Canfor |
NeXGold Mining and Canfor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NeXGold Mining and Canfor
The main advantage of trading using opposite NeXGold Mining and Canfor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NeXGold Mining position performs unexpectedly, Canfor 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 Canfor will offset losses from the drop in Canfor's long position.| NeXGold Mining vs. Western Investment | NeXGold Mining vs. Atrium Mortgage Investment | NeXGold Mining vs. Canadian General Investments | NeXGold Mining vs. Medical Facilities |
| Canfor vs. Capstone Mining Corp | Canfor vs. NeXGold Mining Corp | Canfor vs. HPQ Silicon Resources | Canfor vs. Costco Wholesale 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |