Correlation Between Ocumetics Technology and NeXGold Mining
Can any of the company-specific risk be diversified away by investing in both Ocumetics Technology and NeXGold 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 Ocumetics Technology and NeXGold Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ocumetics Technology Corp and NeXGold Mining Corp, you can compare the effects of market volatilities on Ocumetics Technology and NeXGold 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 Ocumetics Technology with a short position of NeXGold Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ocumetics Technology and NeXGold Mining.
Diversification Opportunities for Ocumetics Technology and NeXGold Mining
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ocumetics and NeXGold is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Ocumetics Technology Corp and NeXGold Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NeXGold Mining Corp and Ocumetics Technology 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 Ocumetics Technology Corp are associated (or correlated) with NeXGold Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NeXGold Mining Corp has no effect on the direction of Ocumetics Technology i.e., Ocumetics Technology and NeXGold Mining go up and down completely randomly.
Pair Corralation between Ocumetics Technology and NeXGold Mining
Assuming the 90 days horizon Ocumetics Technology Corp is expected to generate 0.89 times more return on investment than NeXGold Mining. However, Ocumetics Technology Corp is 1.12 times less risky than NeXGold Mining. It trades about 0.02 of its potential returns per unit of risk. NeXGold Mining Corp is currently generating about 0.0 per unit of risk. If you would invest 32.00 in Ocumetics Technology Corp on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Ocumetics Technology Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ocumetics Technology Corp vs. NeXGold Mining Corp
Performance |
| Timeline |
| Ocumetics Technology Corp |
| NeXGold Mining Corp |
Ocumetics Technology and NeXGold Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ocumetics Technology and NeXGold Mining
The main advantage of trading using opposite Ocumetics Technology and NeXGold Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ocumetics Technology position performs unexpectedly, NeXGold 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 NeXGold Mining will offset losses from the drop in NeXGold Mining's long position.| Ocumetics Technology vs. Orca Energy Group | Ocumetics Technology vs. Rogers Communications | Ocumetics Technology vs. Aclara Resources | Ocumetics Technology vs. Greenfire Resources |
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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