Correlation Between Foran Mining and Northern Dynasty

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

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

Diversification Opportunities for Foran Mining and Northern Dynasty

-0.55

Correlation Coefficient

Foran Mining  Northern Dynasty

Excellent diversification

The 3 months correlation between Foran and Northern is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Foran Mining and Northern Dynasty Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northern Dynasty Minerals and Foran 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 Foran Mining are associated (or correlated) with Northern Dynasty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northern Dynasty Minerals has no effect on the direction of Foran Mining i.e., Foran Mining and Northern Dynasty go up and down completely randomly.

Pair Corralation between Foran Mining and Northern Dynasty

Assuming the 90 days trading horizon Foran Mining is expected to under-perform the Northern Dynasty. But the stock apears to be less risky and, when comparing its historical volatility, Foran Mining is 3.15 times less risky than Northern Dynasty. The stock trades about -0.1 of its potential returns per unit of risk. The Northern Dynasty Minerals is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  136.00  in Northern Dynasty Minerals on April 21, 2025 and sell it today you would earn a total of  3.00  from holding Northern Dynasty Minerals or generate 2.21% return on investment over 90 days.

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

Foran Mining  vs.  Northern Dynasty Minerals

Foran Mining

Risk-Adjusted Performance

Very Weak

Over the last 90 days Foran Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's primary indicators remain very healthy which may send shares a bit higher in August 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Northern Dynasty Minerals

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Northern Dynasty Minerals are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very weak primary indicators, Northern Dynasty displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Foran Mining and Northern Dynasty

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

The idea behind Foran Mining and Northern Dynasty 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 CEOs Directory module to screen CEOs from public companies around the world.