Correlation Between Axway Software and MAG Silver
Can any of the company-specific risk be diversified away by investing in both Axway Software and MAG Silver 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 Axway Software and MAG Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axway Software SA and MAG Silver Corp, you can compare the effects of market volatilities on Axway Software and MAG Silver 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 Axway Software with a short position of MAG Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axway Software and MAG Silver.
Diversification Opportunities for Axway Software and MAG Silver
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Axway and MAG is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Axway Software SA and MAG Silver Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAG Silver Corp and Axway Software 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 Axway Software SA are associated (or correlated) with MAG Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAG Silver Corp has no effect on the direction of Axway Software i.e., Axway Software and MAG Silver go up and down completely randomly.
Pair Corralation between Axway Software and MAG Silver
Assuming the 90 days trading horizon Axway Software SA is expected to generate 0.6 times more return on investment than MAG Silver. However, Axway Software SA is 1.66 times less risky than MAG Silver. It trades about 0.05 of its potential returns per unit of risk. MAG Silver Corp is currently generating about 0.01 per unit of risk. If you would invest 1,789 in Axway Software SA on October 11, 2024 and sell it today you would earn a total of 861.00 from holding Axway Software SA or generate 48.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Axway Software SA vs. MAG Silver Corp
Performance |
| Timeline |
| Axway Software SA |
| MAG Silver Corp |
Axway Software and MAG Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axway Software and MAG Silver
The main advantage of trading using opposite Axway Software and MAG Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axway Software position performs unexpectedly, MAG Silver 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 MAG Silver will offset losses from the drop in MAG Silver's long position.| Axway Software vs. PTT Global Chemical | Axway Software vs. CHEMICAL INDUSTRIES | Axway Software vs. ARDAGH METAL PACDL 0001 | Axway Software vs. TRI CHEMICAL LABORATINC |
| MAG Silver vs. Aegean Airlines SA | MAG Silver vs. ASURE SOFTWARE | MAG Silver vs. Axway Software SA | MAG Silver vs. FORMPIPE SOFTWARE AB |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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