Correlation Between Comstock Mining and New Concept

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

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

Diversification Opportunities for Comstock Mining and New Concept

-0.01

Correlation Coefficient

Comstock Mining  New Concept

Good diversification

The 3 months correlation between Comstock and New is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Comstock Mining and New Concept Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Concept Energy and Comstock 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 Comstock Mining are associated (or correlated) with New Concept. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Concept Energy has no effect on the direction of Comstock Mining i.e., Comstock Mining and New Concept go up and down completely randomly.

Pair Corralation between Comstock Mining and New Concept

Given the investment horizon of 90 days Comstock Mining is expected to generate 2.99 times more return on investment than New Concept. However, Comstock Mining is 2.99 times more volatile than New Concept Energy. It trades about 0.09 of its potential returns per unit of risk. New Concept Energy is currently generating about 0.0 per unit of risk. If you would invest  28.00  in Comstock Mining on September 2, 2024 and sell it today you would earn a total of  9.00  from holding Comstock Mining or generate 32.14% return on investment over 90 days.

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

Comstock Mining  vs.  New Concept Energy

Comstock Mining

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Comstock Mining are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Comstock Mining exhibited solid returns over the last few months and may actually be approaching a breakup point.

New Concept Energy

Risk-Adjusted Performance

0 of 100

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 relatively invariable fundamental drivers, New Concept is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Comstock Mining and New Concept

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

The idea behind Comstock Mining and New Concept Energy 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.