Correlation Between NYSE Composite and Orla Mining
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Orla 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 NYSE Composite and Orla Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Orla Mining, you can compare the effects of market volatilities on NYSE Composite and Orla 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 NYSE Composite with a short position of Orla Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Orla Mining.
Diversification Opportunities for NYSE Composite and Orla Mining
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NYSE and Orla is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Orla Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orla Mining and NYSE Composite 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 NYSE Composite are associated (or correlated) with Orla Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orla Mining has no effect on the direction of NYSE Composite i.e., NYSE Composite and Orla Mining go up and down completely randomly.
Pair Corralation between NYSE Composite and Orla Mining
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.49 times less return on investment than Orla Mining. But when comparing it to its historical volatility, NYSE Composite is 3.88 times less risky than Orla Mining. It trades about 0.08 of its potential returns per unit of risk. Orla Mining is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 369.00 in Orla Mining on August 30, 2024 and sell it today you would earn a total of 97.00 from holding Orla Mining or generate 26.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Orla Mining
Performance |
| Timeline |
NYSE Composite and Orla Mining Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Orla Mining
Pair trading matchups for Orla Mining
Pair Trading with NYSE Composite and Orla Mining
The main advantage of trading using opposite NYSE Composite and Orla Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Orla 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 Orla Mining will offset losses from the drop in Orla Mining's long position.| NYSE Composite vs. Delek Drilling | NYSE Composite vs. Helmerich and Payne | NYSE Composite vs. Waste Management | NYSE Composite vs. US Global Investors |
| Orla Mining vs. K92 Mining | Orla Mining vs. Equinox Gold Corp | Orla Mining vs. Contango ORE | Orla Mining vs. Sandstorm Gold Ltd |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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