Correlation Between SUPERNOVA METALS and ANDRADA MINING

Can any of the company-specific risk be diversified away by investing in both SUPERNOVA METALS and ANDRADA MINING 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 SUPERNOVA METALS and ANDRADA MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SUPERNOVA METALS P and ANDRADA MINING LTD, you can compare the effects of market volatilities on SUPERNOVA METALS and ANDRADA MINING 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 SUPERNOVA METALS with a short position of ANDRADA MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of SUPERNOVA METALS and ANDRADA MINING.

Diversification Opportunities for SUPERNOVA METALS and ANDRADA MINING

-0.39

Correlation Coefficient

SUPERNOVA METALS  ANDRADA MINING

Very good diversification

The 3 months correlation between SUPERNOVA and ANDRADA is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding SUPERNOVA METALS P and ANDRADA MINING LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANDRADA MINING LTD and SUPERNOVA METALS 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 SUPERNOVA METALS P are associated (or correlated) with ANDRADA MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANDRADA MINING LTD has no effect on the direction of SUPERNOVA METALS i.e., SUPERNOVA METALS and ANDRADA MINING go up and down completely randomly.

Pair Corralation between SUPERNOVA METALS and ANDRADA MINING

Assuming the 90 days horizon SUPERNOVA METALS P is expected to generate 0.72 times more return on investment than ANDRADA MINING. However, SUPERNOVA METALS P is 1.39 times less risky than ANDRADA MINING. It trades about 0.04 of its potential returns per unit of risk. ANDRADA MINING LTD is currently generating about 0.02 per unit of risk. If you would invest  27.00  in SUPERNOVA METALS P on April 21, 2025 and sell it today you would earn a total of  1.00  from holding SUPERNOVA METALS P or generate 3.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

SUPERNOVA METALS P  vs.  ANDRADA MINING LTD

SUPERNOVA METALS P

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SUPERNOVA METALS P are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, SUPERNOVA METALS is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

ANDRADA MINING LTD

Risk-Adjusted Performance

Weak

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

Pair Trading with SUPERNOVA METALS and ANDRADA MINING

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

The idea behind SUPERNOVA METALS P and ANDRADA MINING LTD 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.

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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.