Correlation Between Northern Minerals and Hecla Mining
Can any of the company-specific risk be diversified away by investing in both Northern Minerals and Hecla 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 Minerals and Hecla Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Northern Minerals Exploration and Hecla Mining, you can compare the effects of market volatilities on Northern Minerals and Hecla 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 Minerals with a short position of Hecla Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northern Minerals and Hecla Mining.
Diversification Opportunities for Northern Minerals and Hecla Mining
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Northern and Hecla is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Northern Minerals Exploration and Hecla Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hecla Mining and Northern Minerals 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 Minerals Exploration are associated (or correlated) with Hecla Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hecla Mining has no effect on the direction of Northern Minerals i.e., Northern Minerals and Hecla Mining go up and down completely randomly.
Pair Corralation between Northern Minerals and Hecla Mining
Given the investment horizon of 90 days Northern Minerals Exploration is expected to under-perform the Hecla Mining. In addition to that, Northern Minerals is 9.38 times more volatile than Hecla Mining. It trades about -0.04 of its total potential returns per unit of risk. Hecla Mining is currently generating about -0.11 per unit of volatility. If you would invest 5,288 in Hecla Mining on November 3, 2024 and sell it today you would lose (138.00) from holding Hecla Mining or give up 2.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Northern Minerals Exploration vs. Hecla Mining
Performance |
| Timeline |
| Northern Minerals |
| Hecla Mining |
Northern Minerals and Hecla Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northern Minerals and Hecla Mining
The main advantage of trading using opposite Northern Minerals and Hecla Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northern Minerals position performs unexpectedly, Hecla 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 Hecla Mining will offset losses from the drop in Hecla Mining's long position.| Northern Minerals vs. American Copper Development | Northern Minerals vs. Triple Flag Precious | Northern Minerals vs. Hecla Mining | Northern Minerals vs. Compania de Minas |
| Hecla Mining vs. Triple Flag Precious | Hecla Mining vs. McEwen Mining | Hecla Mining vs. Endeavour Silver Corp | Hecla Mining vs. Hecla Mining |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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