Correlation Between First Majestic and Adyton Resources
Can any of the company-specific risk be diversified away by investing in both First Majestic and Adyton Resources 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 First Majestic and Adyton Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Majestic Silver and Adyton Resources Corp, you can compare the effects of market volatilities on First Majestic and Adyton Resources 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 First Majestic with a short position of Adyton Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and Adyton Resources.
Diversification Opportunities for First Majestic and Adyton Resources
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and Adyton is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and Adyton Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adyton Resources Corp and First Majestic 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 First Majestic Silver are associated (or correlated) with Adyton Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adyton Resources Corp has no effect on the direction of First Majestic i.e., First Majestic and Adyton Resources go up and down completely randomly.
Pair Corralation between First Majestic and Adyton Resources
Assuming the 90 days horizon First Majestic Silver is expected to under-perform the Adyton Resources. But the stock apears to be less risky and, when comparing its historical volatility, First Majestic Silver is 3.27 times less risky than Adyton Resources. The stock trades about -0.29 of its potential returns per unit of risk. The Adyton Resources Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 17.00 in Adyton Resources Corp on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Adyton Resources Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Majestic Silver vs. Adyton Resources Corp
Performance |
| Timeline |
| First Majestic Silver |
| Adyton Resources Corp |
First Majestic and Adyton Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and Adyton Resources
The main advantage of trading using opposite First Majestic and Adyton Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, Adyton Resources 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 Adyton Resources will offset losses from the drop in Adyton Resources' long position.| First Majestic vs. Slate Grocery REIT | First Majestic vs. Toronto Dominion Bank | First Majestic vs. Enduro Metals Corp | First Majestic vs. Intact Financial Corp |
| Adyton Resources vs. Sangoma Technologies Corp | Adyton Resources vs. Canlan Ice Sports | Adyton Resources vs. Network Media Group | Adyton Resources vs. Thunderbird Entertainment Group |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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