Correlation Between New Concept and Comstock Mining

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

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

Diversification Opportunities for New Concept and Comstock Mining

0.43

Correlation Coefficient

New Concept  Comstock Mining

Very weak diversification

The 3 months correlation between New and Comstock is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding New Concept Energy and Comstock Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comstock Mining and New Concept 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 New Concept Energy are associated (or correlated) with Comstock Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comstock Mining has no effect on the direction of New Concept i.e., New Concept and Comstock Mining go up and down completely randomly.

Pair Corralation between New Concept and Comstock Mining

Considering the 90-day investment horizon New Concept Energy is expected to generate 0.4 times more return on investment than Comstock Mining. However, New Concept Energy is 2.48 times less risky than Comstock Mining. It trades about -0.13 of its potential returns per unit of risk. Comstock Mining is currently generating about -0.19 per unit of risk. If you would invest  114.00  in New Concept Energy on December 28, 2024 and sell it today you would lose (30.00) from holding New Concept Energy or give up 26.32% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

New Concept Energy  vs.  Comstock Mining

New Concept Energy

Risk-Adjusted Performance

Very Weak

Over the last 90 days New Concept Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Even with inconsistent performance in the last few months, the Stock's fundamental drivers remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Comstock Mining

Risk-Adjusted Performance

Very Weak

Over the last 90 days Comstock Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with New Concept and Comstock Mining

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

The idea behind New Concept Energy and Comstock 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 Commodity Directory module to find actively traded commodities issued by global exchanges.