Correlation Between NexGen Energy and Else Nutrition
Can any of the company-specific risk be diversified away by investing in both NexGen Energy and Else Nutrition 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 NexGen Energy and Else Nutrition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NexGen Energy and Else Nutrition Holdings, you can compare the effects of market volatilities on NexGen Energy and Else Nutrition 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 NexGen Energy with a short position of Else Nutrition. Check out your portfolio center. Please also check ongoing floating volatility patterns of NexGen Energy and Else Nutrition.
Diversification Opportunities for NexGen Energy and Else Nutrition
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NexGen and Else is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding NexGen Energy and Else Nutrition Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Else Nutrition Holdings and NexGen Energy 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 NexGen Energy are associated (or correlated) with Else Nutrition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Else Nutrition Holdings has no effect on the direction of NexGen Energy i.e., NexGen Energy and Else Nutrition go up and down completely randomly.
Pair Corralation between NexGen Energy and Else Nutrition
Assuming the 90 days trading horizon NexGen Energy is expected to generate 0.31 times more return on investment than Else Nutrition. However, NexGen Energy is 3.26 times less risky than Else Nutrition. It trades about 0.28 of its potential returns per unit of risk. Else Nutrition Holdings is currently generating about -0.13 per unit of risk. If you would invest 743.00 in NexGen Energy on September 3, 2024 and sell it today you would earn a total of 448.00 from holding NexGen Energy or generate 60.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NexGen Energy vs. Else Nutrition Holdings
Performance |
| Timeline |
| NexGen Energy |
| Else Nutrition Holdings |
NexGen Energy and Else Nutrition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NexGen Energy and Else Nutrition
The main advantage of trading using opposite NexGen Energy and Else Nutrition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NexGen Energy position performs unexpectedly, Else Nutrition 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 Else Nutrition will offset losses from the drop in Else Nutrition's long position.| NexGen Energy vs. Fission Uranium Corp | NexGen Energy vs. Denison Mines Corp | NexGen Energy vs. Energy Fuels | NexGen Energy vs. enCore Energy Corp |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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