Correlation Between NexGen Energy and Deep Yellow
Can any of the company-specific risk be diversified away by investing in both NexGen Energy and Deep Yellow 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 Deep Yellow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NexGen Energy and Deep Yellow, you can compare the effects of market volatilities on NexGen Energy and Deep Yellow 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 Deep Yellow. Check out your portfolio center. Please also check ongoing floating volatility patterns of NexGen Energy and Deep Yellow.
Diversification Opportunities for NexGen Energy and Deep Yellow
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NexGen and Deep is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding NexGen Energy and Deep Yellow in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deep Yellow 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 Deep Yellow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deep Yellow has no effect on the direction of NexGen Energy i.e., NexGen Energy and Deep Yellow go up and down completely randomly.
Pair Corralation between NexGen Energy and Deep Yellow
Considering the 90-day investment horizon NexGen Energy is expected to generate 1.99 times less return on investment than Deep Yellow. But when comparing it to its historical volatility, NexGen Energy is 1.63 times less risky than Deep Yellow. It trades about 0.1 of its potential returns per unit of risk. Deep Yellow is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 89.00 in Deep Yellow on June 7, 2025 and sell it today you would earn a total of 29.00 from holding Deep Yellow or generate 32.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NexGen Energy vs. Deep Yellow
Performance |
| Timeline |
| NexGen Energy |
| Deep Yellow |
NexGen Energy and Deep Yellow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NexGen Energy and Deep Yellow
The main advantage of trading using opposite NexGen Energy and Deep Yellow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NexGen Energy position performs unexpectedly, Deep Yellow 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 Deep Yellow will offset losses from the drop in Deep Yellow's long position.| NexGen Energy vs. BHP Group Limited | NexGen Energy vs. Denison Mines Corp | NexGen Energy vs. Uranium Energy Corp | NexGen Energy vs. Energy Fuels |
| Deep Yellow vs. Paladin Energy | Deep Yellow vs. Uranium Royalty Corp | Deep Yellow vs. NexGen Energy | Deep Yellow 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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