Correlation Between Cassiar Gold and Ngx Energy

Can any of the company-specific risk be diversified away by investing in both Cassiar Gold and Ngx Energy 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 Cassiar Gold and Ngx Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cassiar Gold Corp and Ngx Energy International, you can compare the effects of market volatilities on Cassiar Gold and Ngx Energy 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 Cassiar Gold with a short position of Ngx Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cassiar Gold and Ngx Energy.

Diversification Opportunities for Cassiar Gold and Ngx Energy

-0.53

Correlation Coefficient

Cassiar Gold  Ngx Energy

Excellent diversification

The 3 months correlation between Cassiar and Ngx is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Cassiar Gold Corp and Ngx Energy International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ngx Energy International and Cassiar Gold 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 Cassiar Gold Corp are associated (or correlated) with Ngx Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ngx Energy International has no effect on the direction of Cassiar Gold i.e., Cassiar Gold and Ngx Energy go up and down completely randomly.

Pair Corralation between Cassiar Gold and Ngx Energy

Assuming the 90 days trading horizon Cassiar Gold Corp is expected to under-perform the Ngx Energy. In addition to that, Cassiar Gold is 1.09 times more volatile than Ngx Energy International. It trades about -0.13 of its total potential returns per unit of risk. Ngx Energy International is currently generating about 0.06 per unit of volatility. If you would invest  98.00  in Ngx Energy International on October 22, 2024 and sell it today you would earn a total of  9.00  from holding Ngx Energy International or generate 9.18% return on investment over 90 days.

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

Cassiar Gold Corp  vs.  Ngx Energy International

Cassiar Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cassiar Gold Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's fundamental indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Ngx Energy International

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ngx Energy International are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Ngx Energy may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Cassiar Gold and Ngx Energy

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

The idea behind Cassiar Gold Corp and Ngx Energy International 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.