Correlation Between NovaGold Resources and Eastwood Bio
Can any of the company-specific risk be diversified away by investing in both NovaGold Resources and Eastwood Bio 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 NovaGold Resources and Eastwood Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NovaGold Resources and Eastwood Bio Medical Canada, you can compare the effects of market volatilities on NovaGold Resources and Eastwood Bio 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 NovaGold Resources with a short position of Eastwood Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of NovaGold Resources and Eastwood Bio.
Diversification Opportunities for NovaGold Resources and Eastwood Bio
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between NovaGold and Eastwood is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding NovaGold Resources and Eastwood Bio Medical Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastwood Bio Medical and NovaGold Resources 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 NovaGold Resources are associated (or correlated) with Eastwood Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastwood Bio Medical has no effect on the direction of NovaGold Resources i.e., NovaGold Resources and Eastwood Bio go up and down completely randomly.
Pair Corralation between NovaGold Resources and Eastwood Bio
Assuming the 90 days horizon NovaGold Resources is expected to under-perform the Eastwood Bio. But the stock apears to be less risky and, when comparing its historical volatility, NovaGold Resources is 4.6 times less risky than Eastwood Bio. The stock trades about -0.09 of its potential returns per unit of risk. The Eastwood Bio Medical Canada is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 95.00 in Eastwood Bio Medical Canada on September 24, 2024 and sell it today you would lose (41.00) from holding Eastwood Bio Medical Canada or give up 43.16% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.46% |
Values | Daily Returns |
NovaGold Resources vs. Eastwood Bio Medical Canada
Performance |
Timeline |
NovaGold Resources |
Eastwood Bio Medical |
NovaGold Resources and Eastwood Bio Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with NovaGold Resources and Eastwood Bio
The main advantage of trading using opposite NovaGold Resources and Eastwood Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NovaGold Resources position performs unexpectedly, Eastwood Bio 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 Eastwood Bio will offset losses from the drop in Eastwood Bio's long position.NovaGold Resources vs. Centerra Gold | NovaGold Resources vs. Alamos Gold | NovaGold Resources vs. MAG Silver Corp | NovaGold Resources vs. Seabridge Gold |
Eastwood Bio vs. Transcontinental | Eastwood Bio vs. Premium Brands Holdings | Eastwood Bio vs. Exchange Income | Eastwood Bio vs. ATCO |
Check out your portfolio center.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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Bonds Directory Find actively traded corporate debentures issued by US companies |