Correlation Between NovaGold Resources and Entree Resources
Can any of the company-specific risk be diversified away by investing in both NovaGold Resources and Entree 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 NovaGold Resources and Entree Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NovaGold Resources and Entree Resources, you can compare the effects of market volatilities on NovaGold Resources and Entree 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 NovaGold Resources with a short position of Entree Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of NovaGold Resources and Entree Resources.
Diversification Opportunities for NovaGold Resources and Entree Resources
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NovaGold and Entree is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding NovaGold Resources and Entree Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entree Resources and NovaGold Resources 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 NovaGold Resources are associated (or correlated) with Entree Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entree Resources has no effect on the direction of NovaGold Resources i.e., NovaGold Resources and Entree Resources go up and down completely randomly.
Pair Corralation between NovaGold Resources and Entree Resources
Assuming the 90 days horizon NovaGold Resources is expected to under-perform the Entree Resources. In addition to that, NovaGold Resources is 1.04 times more volatile than Entree Resources. It trades about 0.0 of its total potential returns per unit of risk. Entree Resources is currently generating about 0.19 per unit of volatility. If you would invest 205.00 in Entree Resources on September 18, 2024 and sell it today you would earn a total of 27.00 from holding Entree Resources or generate 13.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NovaGold Resources vs. Entree Resources
Performance |
| Timeline |
| NovaGold Resources |
| Entree Resources |
NovaGold Resources and Entree Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NovaGold Resources and Entree Resources
The main advantage of trading using opposite NovaGold Resources and Entree Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NovaGold Resources position performs unexpectedly, Entree 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 Entree Resources will offset losses from the drop in Entree Resources' long position.| NovaGold Resources vs. Centerra Gold | NovaGold Resources vs. Alamos Gold | NovaGold Resources vs. MAG Silver Corp | NovaGold Resources vs. Seabridge Gold |
| Entree Resources vs. Foraco International SA | Entree Resources vs. Geodrill Limited | Entree Resources vs. Major Drilling Group | Entree Resources vs. Bri Chem 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |