Correlation Between EMX Royalty and Nevada King

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Can any of the company-specific risk be diversified away by investing in both EMX Royalty and Nevada King 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 EMX Royalty and Nevada King into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EMX Royalty Corp and Nevada King Gold, you can compare the effects of market volatilities on EMX Royalty and Nevada King 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 EMX Royalty with a short position of Nevada King. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMX Royalty and Nevada King.

Diversification Opportunities for EMX Royalty and Nevada King

EMXNevadaDiversified AwayEMXNevadaDiversified Away100%
0.12
  Correlation Coefficient

Average diversification

The 3 months correlation between EMX and Nevada is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding EMX Royalty Corp and Nevada King Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nevada King Gold and EMX Royalty 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 EMX Royalty Corp are associated (or correlated) with Nevada King. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nevada King Gold has no effect on the direction of EMX Royalty i.e., EMX Royalty and Nevada King go up and down completely randomly.

Pair Corralation between EMX Royalty and Nevada King

Considering the 90-day investment horizon EMX Royalty is expected to generate 2.29 times less return on investment than Nevada King. But when comparing it to its historical volatility, EMX Royalty Corp is 3.39 times less risky than Nevada King. It trades about 0.04 of its potential returns per unit of risk. Nevada King Gold is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  20.00  in Nevada King Gold on November 24, 2024 and sell it today you would earn a total of  0.00  from holding Nevada King Gold or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

EMX Royalty Corp  vs.  Nevada King Gold

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -20-15-10-505
JavaScript chart by amCharts 3.21.15EMX NKGFF
       Timeline  
EMX Royalty Corp 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in EMX Royalty Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong primary indicators, EMX Royalty is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb1.651.71.751.81.851.9
Nevada King Gold 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Nevada King Gold are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Nevada King may actually be approaching a critical reversion point that can send shares even higher in March 2025.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.160.170.180.190.20.210.220.230.24

EMX Royalty and Nevada King Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.22-3.91-2.6-1.290.01.312.653.985.32 0.020.040.060.080.100.120.14
JavaScript chart by amCharts 3.21.15EMX NKGFF
       Returns  

Pair Trading with EMX Royalty and Nevada King

The main advantage of trading using opposite EMX Royalty and Nevada King positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EMX Royalty position performs unexpectedly, Nevada King 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 Nevada King will offset losses from the drop in Nevada King's long position.
The idea behind EMX Royalty Corp and Nevada King Gold 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.

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