Correlation Between First Majestic and CanAlaska Uranium
Can any of the company-specific risk be diversified away by investing in both First Majestic and CanAlaska Uranium 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 CanAlaska Uranium 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 CanAlaska Uranium, you can compare the effects of market volatilities on First Majestic and CanAlaska Uranium 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 CanAlaska Uranium. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and CanAlaska Uranium.
Diversification Opportunities for First Majestic and CanAlaska Uranium
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and CanAlaska is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and CanAlaska Uranium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CanAlaska Uranium 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 CanAlaska Uranium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CanAlaska Uranium has no effect on the direction of First Majestic i.e., First Majestic and CanAlaska Uranium go up and down completely randomly.
Pair Corralation between First Majestic and CanAlaska Uranium
Assuming the 90 days horizon First Majestic Silver is expected to under-perform the CanAlaska Uranium. But the stock apears to be less risky and, when comparing its historical volatility, First Majestic Silver is 1.52 times less risky than CanAlaska Uranium. The stock trades about 0.0 of its potential returns per unit of risk. The CanAlaska Uranium is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 37.00 in CanAlaska Uranium on August 30, 2024 and sell it today you would earn a total of 38.00 from holding CanAlaska Uranium or generate 102.7% 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. CanAlaska Uranium
Performance |
| Timeline |
| First Majestic Silver |
| CanAlaska Uranium |
First Majestic and CanAlaska Uranium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and CanAlaska Uranium
The main advantage of trading using opposite First Majestic and CanAlaska Uranium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, CanAlaska Uranium 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 CanAlaska Uranium will offset losses from the drop in CanAlaska Uranium's long position.| First Majestic vs. Talon Metals Corp | First Majestic vs. Champion Gaming Group | First Majestic vs. SalesforceCom CDR | First Majestic vs. Gfl Environmental Holdings |
| CanAlaska Uranium vs. First Majestic Silver | CanAlaska Uranium vs. Ivanhoe Energy | CanAlaska Uranium vs. Orezone Gold Corp | CanAlaska Uranium vs. Faraday Copper 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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