Correlation Between Ares Management and Silvercorp Metals
Can any of the company-specific risk be diversified away by investing in both Ares Management and Silvercorp Metals 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 Ares Management and Silvercorp Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ares Management Corp and Silvercorp Metals, you can compare the effects of market volatilities on Ares Management and Silvercorp Metals 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 Ares Management with a short position of Silvercorp Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ares Management and Silvercorp Metals.
Diversification Opportunities for Ares Management and Silvercorp Metals
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ares and Silvercorp is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Ares Management Corp and Silvercorp Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silvercorp Metals and Ares Management 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 Ares Management Corp are associated (or correlated) with Silvercorp Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silvercorp Metals has no effect on the direction of Ares Management i.e., Ares Management and Silvercorp Metals go up and down completely randomly.
Pair Corralation between Ares Management and Silvercorp Metals
Assuming the 90 days horizon Ares Management Corp is expected to generate 0.98 times more return on investment than Silvercorp Metals. However, Ares Management Corp is 1.02 times less risky than Silvercorp Metals. It trades about 0.12 of its potential returns per unit of risk. Silvercorp Metals is currently generating about -0.19 per unit of risk. If you would invest 16,733 in Ares Management Corp on October 1, 2024 and sell it today you would earn a total of 691.00 from holding Ares Management Corp or generate 4.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ares Management Corp vs. Silvercorp Metals
Performance |
| Timeline |
| Ares Management Corp |
| Silvercorp Metals |
Ares Management and Silvercorp Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ares Management and Silvercorp Metals
The main advantage of trading using opposite Ares Management and Silvercorp Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ares Management position performs unexpectedly, Silvercorp Metals 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 Silvercorp Metals will offset losses from the drop in Silvercorp Metals' long position.| Ares Management vs. Blackstone Group | Ares Management vs. The Bank of | Ares Management vs. Ameriprise Financial | Ares Management vs. T Rowe Price |
| Silvercorp Metals vs. Spirent Communications plc | Silvercorp Metals vs. SBM OFFSHORE | Silvercorp Metals vs. Transport International Holdings | Silvercorp Metals vs. SOLSTAD OFFSHORE NK |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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