Correlation Between NorthIsle Copper and Group Eleven

Can any of the company-specific risk be diversified away by investing in both NorthIsle Copper and Group Eleven 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 NorthIsle Copper and Group Eleven into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between NorthIsle Copper and and Group Eleven Resources, you can compare the effects of market volatilities on NorthIsle Copper and Group Eleven 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 NorthIsle Copper with a short position of Group Eleven. Check out your portfolio center. Please also check ongoing floating volatility patterns of NorthIsle Copper and Group Eleven.

Diversification Opportunities for NorthIsle Copper and Group Eleven

0.43

Correlation Coefficient

NorthIsle Copper  Group Eleven

Very weak diversification

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

Pair Corralation between NorthIsle Copper and Group Eleven

Assuming the 90 days horizon NorthIsle Copper and is expected to generate 1.07 times more return on investment than Group Eleven. However, NorthIsle Copper is 1.07 times more volatile than Group Eleven Resources. It trades about 0.04 of its potential returns per unit of risk. Group Eleven Resources is currently generating about -0.01 per unit of risk. If you would invest  42.00  in NorthIsle Copper and on October 7, 2024 and sell it today you would earn a total of  2.00  from holding NorthIsle Copper and or generate 4.76% return on investment over 90 days.

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

NorthIsle Copper and  vs.  Group Eleven Resources

NorthIsle Copper

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in NorthIsle Copper and are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, NorthIsle Copper may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Group Eleven Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Group Eleven Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Group Eleven is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with NorthIsle Copper and Group Eleven

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

The idea behind NorthIsle Copper and and Group Eleven Resources 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.