Correlation Between York Harbour and NGEx Minerals

Can any of the company-specific risk be diversified away by investing in both York Harbour and NGEx Minerals 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 York Harbour and NGEx Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between York Harbour Metals and NGEx Minerals, you can compare the effects of market volatilities on York Harbour and NGEx Minerals 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 York Harbour with a short position of NGEx Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of York Harbour and NGEx Minerals.

Diversification Opportunities for York Harbour and NGEx Minerals

-0.06

Correlation Coefficient

York Harbour  NGEx Minerals

Good diversification

The 3 months correlation between York and NGEx is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding York Harbour Metals and NGEx Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NGEx Minerals and York Harbour 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 York Harbour Metals are associated (or correlated) with NGEx Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NGEx Minerals has no effect on the direction of York Harbour i.e., York Harbour and NGEx Minerals go up and down completely randomly.

Pair Corralation between York Harbour and NGEx Minerals

Assuming the 90 days horizon York Harbour Metals is expected to generate 5.14 times more return on investment than NGEx Minerals. However, York Harbour is 5.14 times more volatile than NGEx Minerals. It trades about 0.06 of its potential returns per unit of risk. NGEx Minerals is currently generating about 0.02 per unit of risk. If you would invest  4.21  in York Harbour Metals on December 27, 2024 and sell it today you would earn a total of  0.07  from holding York Harbour Metals or generate 1.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

York Harbour Metals  vs.  NGEx Minerals

York Harbour Metals

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in York Harbour Metals are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward-looking signals, York Harbour reported solid returns over the last few months and may actually be approaching a breakup point.

NGEx Minerals

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in NGEx Minerals are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, NGEx Minerals is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with York Harbour and NGEx Minerals

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

The idea behind York Harbour Metals and NGEx Minerals 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..