Correlation Between Polymet Mining and NorthIsle Copper

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

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

Diversification Opportunities for Polymet Mining and NorthIsle Copper

-0.01

Correlation Coefficient

Polymet Mining  NorthIsle Copper

Good diversification

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

Pair Corralation between Polymet Mining and NorthIsle Copper

If you would invest  208.00  in Polymet Mining Corp on September 13, 2024 and sell it today you would earn a total of  0.00  from holding Polymet Mining Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Polymet Mining Corp  vs.  NorthIsle Copper and

Polymet Mining Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Polymet Mining Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy essential indicators, Polymet Mining is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

NorthIsle Copper

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NorthIsle Copper and has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Polymet Mining and NorthIsle Copper

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

The idea behind Polymet Mining Corp and NorthIsle Copper and 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.