Correlation Between Nuinsco Resources and Magna Mining
Can any of the company-specific risk be diversified away by investing in both Nuinsco Resources and Magna 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 Nuinsco Resources and Magna Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuinsco Resources Limited and Magna Mining, you can compare the effects of market volatilities on Nuinsco Resources and Magna 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 Nuinsco Resources with a short position of Magna Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuinsco Resources and Magna Mining.
Diversification Opportunities for Nuinsco Resources and Magna Mining
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nuinsco and Magna is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Nuinsco Resources Limited and Magna Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magna Mining and Nuinsco 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 Nuinsco Resources Limited are associated (or correlated) with Magna Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magna Mining has no effect on the direction of Nuinsco Resources i.e., Nuinsco Resources and Magna Mining go up and down completely randomly.
Pair Corralation between Nuinsco Resources and Magna Mining
Assuming the 90 days horizon Nuinsco Resources Limited is expected to under-perform the Magna Mining. In addition to that, Nuinsco Resources is 5.14 times more volatile than Magna Mining. It trades about -0.06 of its total potential returns per unit of risk. Magna Mining is currently generating about 0.21 per unit of volatility. If you would invest 85.00 in Magna Mining on August 30, 2024 and sell it today you would earn a total of 17.00 from holding Magna Mining or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuinsco Resources Limited vs. Magna Mining
Performance |
| Timeline |
| Nuinsco Resources |
| Magna Mining |
Nuinsco Resources and Magna Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuinsco Resources and Magna Mining
The main advantage of trading using opposite Nuinsco Resources and Magna Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuinsco Resources position performs unexpectedly, Magna 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 Magna Mining will offset losses from the drop in Magna Mining's long position.| Nuinsco Resources vs. Newport Gold | Nuinsco Resources vs. Monarca Minerals | Nuinsco Resources vs. First American Silver | Nuinsco Resources vs. Tamino Minerals |
| Magna Mining vs. Emerita Resources Corp | Magna Mining vs. Stone Gold | Magna Mining vs. BCM Resources | Magna Mining vs. Fathom Nickel |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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