Correlation Between First Majestic and Brunswick Exploration
Can any of the company-specific risk be diversified away by investing in both First Majestic and Brunswick Exploration 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 Brunswick Exploration 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 Brunswick Exploration, you can compare the effects of market volatilities on First Majestic and Brunswick Exploration 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 Brunswick Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and Brunswick Exploration.
Diversification Opportunities for First Majestic and Brunswick Exploration
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between First and Brunswick is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and Brunswick Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brunswick Exploration 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 Brunswick Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brunswick Exploration has no effect on the direction of First Majestic i.e., First Majestic and Brunswick Exploration go up and down completely randomly.
Pair Corralation between First Majestic and Brunswick Exploration
Assuming the 90 days horizon First Majestic Silver is expected to generate 0.59 times more return on investment than Brunswick Exploration. However, First Majestic Silver is 1.69 times less risky than Brunswick Exploration. It trades about 0.08 of its potential returns per unit of risk. Brunswick Exploration is currently generating about 0.03 per unit of risk. If you would invest 791.00 in First Majestic Silver on October 24, 2024 and sell it today you would earn a total of 32.00 from holding First Majestic Silver or generate 4.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Majestic Silver vs. Brunswick Exploration
Performance |
| Timeline |
| First Majestic Silver |
| Brunswick Exploration |
First Majestic and Brunswick Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and Brunswick Exploration
The main advantage of trading using opposite First Majestic and Brunswick Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, Brunswick Exploration 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 Brunswick Exploration will offset losses from the drop in Brunswick Exploration's long position.| First Majestic vs. Calian Technologies | First Majestic vs. Partners Value Investments | First Majestic vs. Canaf Investments | First Majestic vs. Plaza Retail REIT |
| Brunswick Exploration vs. InZinc Mining | Brunswick Exploration vs. Hercules Metals Corp | Brunswick Exploration vs. Guanajuato Silver | Brunswick Exploration vs. Copaur Minerals |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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