Correlation Between PROCTER GAMBLE and Nicola Mining
Can any of the company-specific risk be diversified away by investing in both PROCTER GAMBLE and Nicola 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 PROCTER GAMBLE and Nicola Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PROCTER GAMBLE CDR and Nicola Mining, you can compare the effects of market volatilities on PROCTER GAMBLE and Nicola 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 PROCTER GAMBLE with a short position of Nicola Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of PROCTER GAMBLE and Nicola Mining.
Diversification Opportunities for PROCTER GAMBLE and Nicola Mining
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between PROCTER and Nicola is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding PROCTER GAMBLE CDR and Nicola Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nicola Mining and PROCTER GAMBLE 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 PROCTER GAMBLE CDR are associated (or correlated) with Nicola Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nicola Mining has no effect on the direction of PROCTER GAMBLE i.e., PROCTER GAMBLE and Nicola Mining go up and down completely randomly.
Pair Corralation between PROCTER GAMBLE and Nicola Mining
Assuming the 90 days trading horizon PROCTER GAMBLE is expected to generate 2.39 times less return on investment than Nicola Mining. But when comparing it to its historical volatility, PROCTER GAMBLE CDR is 4.74 times less risky than Nicola Mining. It trades about 0.06 of its potential returns per unit of risk. Nicola Mining is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 26.00 in Nicola Mining on September 14, 2024 and sell it today you would earn a total of 2.00 from holding Nicola Mining or generate 7.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.63% |
| Values | Daily Returns |
PROCTER GAMBLE CDR vs. Nicola Mining
Performance |
| Timeline |
| PROCTER GAMBLE CDR |
| Nicola Mining |
PROCTER GAMBLE and Nicola Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PROCTER GAMBLE and Nicola Mining
The main advantage of trading using opposite PROCTER GAMBLE and Nicola Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PROCTER GAMBLE position performs unexpectedly, Nicola 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 Nicola Mining will offset losses from the drop in Nicola Mining's long position.| PROCTER GAMBLE vs. Nicola Mining | PROCTER GAMBLE vs. Metalero Mining Corp | PROCTER GAMBLE vs. Algoma Steel Group | PROCTER GAMBLE vs. Tree Island Steel |
| Nicola Mining vs. Foraco International SA | Nicola Mining vs. Geodrill Limited | Nicola Mining vs. Major Drilling Group | Nicola Mining vs. Bri Chem 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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