Correlation Between Nicola Mining and True North
Can any of the company-specific risk be diversified away by investing in both Nicola Mining and True North 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 Nicola Mining and True North into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nicola Mining and True North Gems, you can compare the effects of market volatilities on Nicola Mining and True North 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 Nicola Mining with a short position of True North. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nicola Mining and True North.
Diversification Opportunities for Nicola Mining and True North
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nicola and True is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Nicola Mining and True North Gems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on True North Gems and Nicola 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 Nicola Mining are associated (or correlated) with True North. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of True North Gems has no effect on the direction of Nicola Mining i.e., Nicola Mining and True North go up and down completely randomly.
Pair Corralation between Nicola Mining and True North
Assuming the 90 days horizon Nicola Mining is expected to generate 0.63 times more return on investment than True North. However, Nicola Mining is 1.58 times less risky than True North. It trades about -0.08 of its potential returns per unit of risk. True North Gems is currently generating about -0.13 per unit of risk. If you would invest 34.00 in Nicola Mining on August 29, 2024 and sell it today you would lose (6.00) from holding Nicola Mining or give up 17.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.62% |
| Values | Daily Returns |
Nicola Mining vs. True North Gems
Performance |
| Timeline |
| Nicola Mining |
| True North Gems |
Nicola Mining and True North Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nicola Mining and True North
The main advantage of trading using opposite Nicola Mining and True North positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nicola Mining position performs unexpectedly, True North 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 True North will offset losses from the drop in True North's long position.| Nicola Mining vs. First Majestic Silver | Nicola Mining vs. Ivanhoe Energy | Nicola Mining vs. Orezone Gold Corp | Nicola Mining vs. Faraday Copper Corp |
| True North vs. Verizon Communications CDR | True North vs. Computer Modelling Group | True North vs. Nicola Mining | True North vs. Ramp Metals |
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.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |