Correlation Between SSR Mining and NovaGold Resources
Can any of the company-specific risk be diversified away by investing in both SSR Mining and NovaGold 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 SSR Mining and NovaGold Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SSR Mining and NovaGold Resources, you can compare the effects of market volatilities on SSR Mining and NovaGold 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 SSR Mining with a short position of NovaGold Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSR Mining and NovaGold Resources.
Diversification Opportunities for SSR Mining and NovaGold Resources
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between SSR and NovaGold is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding SSR Mining and NovaGold Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NovaGold Resources and SSR Mining 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 SSR Mining are associated (or correlated) with NovaGold Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NovaGold Resources has no effect on the direction of SSR Mining i.e., SSR Mining and NovaGold Resources go up and down completely randomly.
Pair Corralation between SSR Mining and NovaGold Resources
Assuming the 90 days trading horizon SSR Mining is expected to under-perform the NovaGold Resources. In addition to that, SSR Mining is 1.56 times more volatile than NovaGold Resources. It trades about -0.08 of its total potential returns per unit of risk. NovaGold Resources is currently generating about -0.02 per unit of volatility. If you would invest 505.00 in NovaGold Resources on August 28, 2024 and sell it today you would lose (10.00) from holding NovaGold Resources or give up 1.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SSR Mining vs. NovaGold Resources
Performance |
| Timeline |
| SSR Mining |
| NovaGold Resources |
SSR Mining and NovaGold Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SSR Mining and NovaGold Resources
The main advantage of trading using opposite SSR Mining and NovaGold Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SSR Mining position performs unexpectedly, NovaGold 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 NovaGold Resources will offset losses from the drop in NovaGold Resources' long position.| SSR Mining vs. Pan American Silver | SSR Mining vs. MAG Silver Corp | SSR Mining vs. Osisko Gold Ro | SSR 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |