Correlation Between NeXGold Mining and New Destiny
Can any of the company-specific risk be diversified away by investing in both NeXGold Mining and New Destiny 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 New Destiny 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 New Destiny Mining, you can compare the effects of market volatilities on NeXGold Mining and New Destiny 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 New Destiny. Check out your portfolio center. Please also check ongoing floating volatility patterns of NeXGold Mining and New Destiny.
Diversification Opportunities for NeXGold Mining and New Destiny
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between NeXGold and New is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding NeXGold Mining Corp and New Destiny Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Destiny Mining 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 New Destiny. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Destiny Mining has no effect on the direction of NeXGold Mining i.e., NeXGold Mining and New Destiny go up and down completely randomly.
Pair Corralation between NeXGold Mining and New Destiny
Assuming the 90 days trading horizon NeXGold Mining Corp is expected to under-perform the New Destiny. But the stock apears to be less risky and, when comparing its historical volatility, NeXGold Mining Corp is 2.32 times less risky than New Destiny. The stock trades about -0.07 of its potential returns per unit of risk. The New Destiny Mining is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 3.00 in New Destiny Mining on December 4, 2024 and sell it today you would earn a total of 0.50 from holding New Destiny Mining or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NeXGold Mining Corp vs. New Destiny Mining
Performance |
| Timeline |
| NeXGold Mining Corp |
| New Destiny Mining |
NeXGold Mining and New Destiny Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NeXGold Mining and New Destiny
The main advantage of trading using opposite NeXGold Mining and New Destiny positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NeXGold Mining position performs unexpectedly, New Destiny 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 New Destiny will offset losses from the drop in New Destiny's long position.| NeXGold Mining vs. Titanium Transportation Group | NeXGold Mining vs. VIP Entertainment Technologies | NeXGold Mining vs. Thunderbird Entertainment Group | NeXGold Mining vs. Firan Technology Group |
| New Destiny vs. Advent Wireless | New Destiny vs. Reliq Health Technologies | New Destiny vs. Data Communications Management | New Destiny vs. Hemisphere Energy |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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