Correlation Between Northern Graphite and Altura Mining
Can any of the company-specific risk be diversified away by investing in both Northern Graphite and Altura 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 Northern Graphite and Altura Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Northern Graphite and Altura Mining Limited, you can compare the effects of market volatilities on Northern Graphite and Altura 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 Northern Graphite with a short position of Altura Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northern Graphite and Altura Mining.
Diversification Opportunities for Northern Graphite and Altura Mining
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Northern and Altura is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Northern Graphite and Altura Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altura Mining Limited and Northern Graphite 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 Northern Graphite are associated (or correlated) with Altura Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altura Mining Limited has no effect on the direction of Northern Graphite i.e., Northern Graphite and Altura Mining go up and down completely randomly.
Pair Corralation between Northern Graphite and Altura Mining
Assuming the 90 days horizon Northern Graphite is expected to generate 0.9 times more return on investment than Altura Mining. However, Northern Graphite is 1.11 times less risky than Altura Mining. It trades about 0.02 of its potential returns per unit of risk. Altura Mining Limited is currently generating about -0.19 per unit of risk. If you would invest 6.60 in Northern Graphite on September 1, 2024 and sell it today you would lose (0.80) from holding Northern Graphite or give up 12.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Northern Graphite vs. Altura Mining Limited
Performance |
| Timeline |
| Northern Graphite |
| Altura Mining Limited |
Northern Graphite and Altura Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northern Graphite and Altura Mining
The main advantage of trading using opposite Northern Graphite and Altura Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northern Graphite position performs unexpectedly, Altura 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 Altura Mining will offset losses from the drop in Altura Mining's long position.| Northern Graphite vs. South32 Limited | Northern Graphite vs. NioCorp Developments Ltd | Northern Graphite vs. HUMANA INC | Northern Graphite vs. SCOR PK |
| Altura Mining vs. Liontown Resources Limited | Altura Mining vs. ATT Inc | Altura Mining vs. Merck Company | Altura Mining vs. Walt Disney |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |