Correlation Between NIKE and Metalero Mining
Can any of the company-specific risk be diversified away by investing in both NIKE and Metalero 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 NIKE and Metalero Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NIKE Inc CDR and Metalero Mining Corp, you can compare the effects of market volatilities on NIKE and Metalero 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 NIKE with a short position of Metalero Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of NIKE and Metalero Mining.
Diversification Opportunities for NIKE and Metalero Mining
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NIKE and Metalero is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding NIKE Inc CDR and Metalero Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metalero Mining Corp and NIKE 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 NIKE Inc CDR are associated (or correlated) with Metalero Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metalero Mining Corp has no effect on the direction of NIKE i.e., NIKE and Metalero Mining go up and down completely randomly.
Pair Corralation between NIKE and Metalero Mining
Assuming the 90 days trading horizon NIKE Inc CDR is expected to under-perform the Metalero Mining. But the stock apears to be less risky and, when comparing its historical volatility, NIKE Inc CDR is 7.26 times less risky than Metalero Mining. The stock trades about -0.05 of its potential returns per unit of risk. The Metalero Mining Corp is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 15.00 in Metalero Mining Corp on August 31, 2024 and sell it today you would lose (1.00) from holding Metalero Mining Corp or give up 6.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.96% |
| Values | Daily Returns |
NIKE Inc CDR vs. Metalero Mining Corp
Performance |
| Timeline |
| NIKE Inc CDR |
| Metalero Mining Corp |
NIKE and Metalero Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NIKE and Metalero Mining
The main advantage of trading using opposite NIKE and Metalero Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NIKE position performs unexpectedly, Metalero 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 Metalero Mining will offset losses from the drop in Metalero Mining's long position.| NIKE vs. Metalero Mining Corp | NIKE vs. High Liner Foods | NIKE vs. Capstone Mining Corp | NIKE vs. Gfl Environmental Holdings |
| Metalero Mining vs. Newmont Goldcorp Corp | Metalero Mining vs. Agnico Eagle Mines | Metalero Mining vs. Barrick Gold Corp | Metalero Mining vs. Wheaton Precious 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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