Correlation Between Nickel Mines and Giyani Metals
Can any of the company-specific risk be diversified away by investing in both Nickel Mines and Giyani Metals 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 Nickel Mines and Giyani Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nickel Mines Limited and Giyani Metals Corp, you can compare the effects of market volatilities on Nickel Mines and Giyani Metals 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 Nickel Mines with a short position of Giyani Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nickel Mines and Giyani Metals.
Diversification Opportunities for Nickel Mines and Giyani Metals
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nickel and Giyani is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Nickel Mines Limited and Giyani Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Giyani Metals Corp and Nickel Mines 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 Nickel Mines Limited are associated (or correlated) with Giyani Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Giyani Metals Corp has no effect on the direction of Nickel Mines i.e., Nickel Mines and Giyani Metals go up and down completely randomly.
Pair Corralation between Nickel Mines and Giyani Metals
Assuming the 90 days horizon Nickel Mines is expected to generate 10.27 times less return on investment than Giyani Metals. But when comparing it to its historical volatility, Nickel Mines Limited is 2.06 times less risky than Giyani Metals. It trades about 0.01 of its potential returns per unit of risk. Giyani Metals Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 7.00 in Giyani Metals Corp on September 1, 2024 and sell it today you would earn a total of 0.15 from holding Giyani Metals Corp or generate 2.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Nickel Mines Limited vs. Giyani Metals Corp
Performance |
| Timeline |
| Nickel Mines Limited |
| Giyani Metals Corp |
Nickel Mines and Giyani Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nickel Mines and Giyani Metals
The main advantage of trading using opposite Nickel Mines and Giyani Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nickel Mines position performs unexpectedly, Giyani Metals 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 Giyani Metals will offset losses from the drop in Giyani Metals' long position.| Nickel Mines vs. IGO Limited | Nickel Mines vs. Qubec Nickel Corp | Nickel Mines vs. Mineral Resources Limited | Nickel Mines vs. Surge Copper Corp |
| Giyani Metals vs. South32 Limited | Giyani Metals vs. NioCorp Developments Ltd | Giyani Metals vs. HUMANA INC | Giyani Metals vs. SCOR PK |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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