Correlation Between NexGen Energy and Berkeley Energy
Can any of the company-specific risk be diversified away by investing in both NexGen Energy and Berkeley Energy 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 NexGen Energy and Berkeley Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NexGen Energy and Berkeley Energy, you can compare the effects of market volatilities on NexGen Energy and Berkeley Energy 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 NexGen Energy with a short position of Berkeley Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of NexGen Energy and Berkeley Energy.
Diversification Opportunities for NexGen Energy and Berkeley Energy
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NexGen and Berkeley is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding NexGen Energy and Berkeley Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkeley Energy and NexGen Energy 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 NexGen Energy are associated (or correlated) with Berkeley Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berkeley Energy has no effect on the direction of NexGen Energy i.e., NexGen Energy and Berkeley Energy go up and down completely randomly.
Pair Corralation between NexGen Energy and Berkeley Energy
Considering the 90-day investment horizon NexGen Energy is expected to generate 0.77 times more return on investment than Berkeley Energy. However, NexGen Energy is 1.29 times less risky than Berkeley Energy. It trades about 0.12 of its potential returns per unit of risk. Berkeley Energy is currently generating about -0.01 per unit of risk. If you would invest 655.00 in NexGen Energy on June 8, 2025 and sell it today you would earn a total of 125.00 from holding NexGen Energy or generate 19.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NexGen Energy vs. Berkeley Energy
Performance |
| Timeline |
| NexGen Energy |
| Berkeley Energy |
NexGen Energy and Berkeley Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NexGen Energy and Berkeley Energy
The main advantage of trading using opposite NexGen Energy and Berkeley Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NexGen Energy position performs unexpectedly, Berkeley Energy 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 Berkeley Energy will offset losses from the drop in Berkeley Energy's long position.| NexGen Energy vs. Cameco Corp | NexGen Energy vs. Denison Mines Corp | NexGen Energy vs. enCore Energy Corp | NexGen Energy vs. Uranium Energy Corp |
| Berkeley Energy vs. Paladin Energy | Berkeley Energy vs. Uranium Royalty Corp | Berkeley Energy vs. NexGen Energy | Berkeley Energy vs. Denison Mines Corp |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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