Correlation Between Prom Resources and North Bay
Can any of the company-specific risk be diversified away by investing in both Prom Resources and North Bay 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 Prom Resources and North Bay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prom Resources and North Bay Resources, you can compare the effects of market volatilities on Prom Resources and North Bay 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 Prom Resources with a short position of North Bay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prom Resources and North Bay.
Diversification Opportunities for Prom Resources and North Bay
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Prom and North is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Prom Resources and North Bay Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North Bay Resources and Prom Resources 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 Prom Resources are associated (or correlated) with North Bay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North Bay Resources has no effect on the direction of Prom Resources i.e., Prom Resources and North Bay go up and down completely randomly.
Pair Corralation between Prom Resources and North Bay
If you would invest 0.03 in North Bay Resources on September 1, 2024 and sell it today you would earn a total of 0.06 from holding North Bay Resources or generate 200.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.78% |
| Values | Daily Returns |
Prom Resources vs. North Bay Resources
Performance |
| Timeline |
| Prom Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| North Bay Resources |
Prom Resources and North Bay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prom Resources and North Bay
The main advantage of trading using opposite Prom Resources and North Bay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prom Resources position performs unexpectedly, North Bay 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 North Bay will offset losses from the drop in North Bay's long position.| Prom Resources vs. Grillit | Prom Resources vs. ZA Group | Prom Resources vs. Blue Water Global | Prom Resources vs. BJs Restaurants |
| North Bay vs. Defiance Silver Corp | North Bay vs. HUMANA INC | North Bay vs. SCOR PK | North Bay vs. Aquagold International |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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