Correlation Between NOVAGOLD RESOURCES and Apple
Can any of the company-specific risk be diversified away by investing in both NOVAGOLD RESOURCES and Apple 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 Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NOVAGOLD RESOURCES and Apple Inc, you can compare the effects of market volatilities on NOVAGOLD RESOURCES and Apple 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 Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of NOVAGOLD RESOURCES and Apple.
Diversification Opportunities for NOVAGOLD RESOURCES and Apple
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NOVAGOLD and Apple is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding NOVAGOLD RESOURCES and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc 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 Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of NOVAGOLD RESOURCES i.e., NOVAGOLD RESOURCES and Apple go up and down completely randomly.
Pair Corralation between NOVAGOLD RESOURCES and Apple
Assuming the 90 days trading horizon NOVAGOLD RESOURCES is expected to generate 6.92 times less return on investment than Apple. In addition to that, NOVAGOLD RESOURCES is 2.57 times more volatile than Apple Inc. It trades about 0.01 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.1 per unit of volatility. If you would invest 16,360 in Apple Inc on September 26, 2024 and sell it today you would earn a total of 8,140 from holding Apple Inc or generate 49.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NOVAGOLD RESOURCES vs. Apple Inc
Performance |
| Timeline |
| NOVAGOLD RESOURCES |
| Apple Inc |
NOVAGOLD RESOURCES and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NOVAGOLD RESOURCES and Apple
The main advantage of trading using opposite NOVAGOLD RESOURCES and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NOVAGOLD RESOURCES position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| NOVAGOLD RESOURCES vs. AAC TECHNOLOGHLDGADR | NOVAGOLD RESOURCES vs. Performance Food Group | NOVAGOLD RESOURCES vs. National Beverage Corp | NOVAGOLD RESOURCES vs. CN MODERN DAIRY |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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