Correlation Between Osisko Gold and Nexa Resources
Can any of the company-specific risk be diversified away by investing in both Osisko Gold and Nexa Resources 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 Osisko Gold and Nexa Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Osisko Gold Ro and Nexa Resources SA, you can compare the effects of market volatilities on Osisko Gold and Nexa Resources 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 Osisko Gold with a short position of Nexa Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Osisko Gold and Nexa Resources.
Diversification Opportunities for Osisko Gold and Nexa Resources
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Osisko and Nexa is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Osisko Gold Ro and Nexa Resources SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nexa Resources SA and Osisko Gold 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 Osisko Gold Ro are associated (or correlated) with Nexa Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nexa Resources SA has no effect on the direction of Osisko Gold i.e., Osisko Gold and Nexa Resources go up and down completely randomly.
Pair Corralation between Osisko Gold and Nexa Resources
Allowing for the 90-day total investment horizon Osisko Gold Ro is expected to under-perform the Nexa Resources. In addition to that, Osisko Gold is 1.31 times more volatile than Nexa Resources SA. It trades about -0.14 of its total potential returns per unit of risk. Nexa Resources SA is currently generating about -0.1 per unit of volatility. If you would invest 786.00 in Nexa Resources SA on August 28, 2024 and sell it today you would lose (31.00) from holding Nexa Resources SA or give up 3.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Osisko Gold Ro vs. Nexa Resources SA
Performance |
| Timeline |
| Osisko Gold Ro |
| Nexa Resources SA |
Osisko Gold and Nexa Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Osisko Gold and Nexa Resources
The main advantage of trading using opposite Osisko Gold and Nexa Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Osisko Gold position performs unexpectedly, Nexa Resources 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 Nexa Resources will offset losses from the drop in Nexa Resources' long position.The idea behind Osisko Gold Ro and Nexa Resources SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Nexa Resources vs. Materion | Nexa Resources vs. Fury Gold Mines | Nexa Resources vs. Eskay Mining Corp | Nexa Resources vs. EMX Royalty 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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