Correlation Between Blackstone Minerals and Jervois Mining

Can any of the company-specific risk be diversified away by investing in both Blackstone Minerals and Jervois 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 Blackstone Minerals and Jervois Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Blackstone Minerals and Jervois Mining, you can compare the effects of market volatilities on Blackstone Minerals and Jervois 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 Blackstone Minerals with a short position of Jervois Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone Minerals and Jervois Mining.

Diversification Opportunities for Blackstone Minerals and Jervois Mining

0.04

Correlation Coefficient

Blackstone Minerals  Jervois Mining

Significant diversification

The 3 months correlation between Blackstone and Jervois is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Minerals and Jervois Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jervois Mining and Blackstone Minerals 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 Blackstone Minerals are associated (or correlated) with Jervois Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jervois Mining has no effect on the direction of Blackstone Minerals i.e., Blackstone Minerals and Jervois Mining go up and down completely randomly.

Pair Corralation between Blackstone Minerals and Jervois Mining

Assuming the 90 days horizon Blackstone Minerals is expected to generate 14.81 times more return on investment than Jervois Mining. However, Blackstone Minerals is 14.81 times more volatile than Jervois Mining. It trades about 0.14 of its potential returns per unit of risk. Jervois Mining is currently generating about 0.08 per unit of risk. If you would invest  1.22  in Blackstone Minerals on December 28, 2024 and sell it today you would earn a total of  1.58  from holding Blackstone Minerals or generate 129.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

Blackstone Minerals  vs.  Jervois Mining

Blackstone Minerals

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Blackstone Minerals are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Blackstone Minerals reported solid returns over the last few months and may actually be approaching a breakup point.

Jervois Mining

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jervois Mining are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile primary indicators, Jervois Mining may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Blackstone Minerals and Jervois Mining

The main advantage of trading using opposite Blackstone Minerals and Jervois Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackstone Minerals position performs unexpectedly, Jervois 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 Jervois Mining will offset losses from the drop in Jervois Mining's long position.

The idea behind Blackstone Minerals and Jervois Mining 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.

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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 Global Correlations module to find global opportunities by holding instruments from different markets.