Correlation Between First Majestic and Sailfish Royalty
Can any of the company-specific risk be diversified away by investing in both First Majestic and Sailfish Royalty 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 Sailfish Royalty 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 Sailfish Royalty Corp, you can compare the effects of market volatilities on First Majestic and Sailfish Royalty 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 Sailfish Royalty. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and Sailfish Royalty.
Diversification Opportunities for First Majestic and Sailfish Royalty
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and Sailfish is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and Sailfish Royalty Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sailfish Royalty 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 Sailfish Royalty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sailfish Royalty Corp has no effect on the direction of First Majestic i.e., First Majestic and Sailfish Royalty go up and down completely randomly.
Pair Corralation between First Majestic and Sailfish Royalty
Assuming the 90 days horizon First Majestic is expected to generate 3.8 times less return on investment than Sailfish Royalty. In addition to that, First Majestic is 1.15 times more volatile than Sailfish Royalty Corp. It trades about 0.01 of its total potential returns per unit of risk. Sailfish Royalty Corp is currently generating about 0.05 per unit of volatility. If you would invest 94.00 in Sailfish Royalty Corp on January 14, 2025 and sell it today you would earn a total of 72.00 from holding Sailfish Royalty Corp or generate 76.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Majestic Silver vs. Sailfish Royalty Corp
Performance |
| Timeline |
| First Majestic Silver |
| Sailfish Royalty Corp |
First Majestic and Sailfish Royalty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and Sailfish Royalty
The main advantage of trading using opposite First Majestic and Sailfish Royalty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, Sailfish Royalty 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 Sailfish Royalty will offset losses from the drop in Sailfish Royalty's long position.| First Majestic vs. Thunderbird Entertainment Group | First Majestic vs. Sparx Technology | First Majestic vs. Neo Battery Materials | First Majestic vs. Quipt Home Medical |
| Sailfish Royalty vs. Mako Mining Corp | Sailfish Royalty vs. Empress Royalty Corp | Sailfish Royalty vs. Orogen Royalties |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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