Correlation Between First Majestic and NanoXplore
Can any of the company-specific risk be diversified away by investing in both First Majestic and NanoXplore 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 NanoXplore 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 NanoXplore, you can compare the effects of market volatilities on First Majestic and NanoXplore 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 NanoXplore. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and NanoXplore.
Diversification Opportunities for First Majestic and NanoXplore
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and NanoXplore is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and NanoXplore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NanoXplore 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 NanoXplore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NanoXplore has no effect on the direction of First Majestic i.e., First Majestic and NanoXplore go up and down completely randomly.
Pair Corralation between First Majestic and NanoXplore
Assuming the 90 days horizon First Majestic Silver is expected to under-perform the NanoXplore. But the stock apears to be less risky and, when comparing its historical volatility, First Majestic Silver is 1.04 times less risky than NanoXplore. The stock trades about 0.0 of its potential returns per unit of risk. The NanoXplore is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 255.00 in NanoXplore on September 3, 2024 and sell it today you would lose (30.00) from holding NanoXplore or give up 11.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Majestic Silver vs. NanoXplore
Performance |
| Timeline |
| First Majestic Silver |
| NanoXplore |
First Majestic and NanoXplore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and NanoXplore
The main advantage of trading using opposite First Majestic and NanoXplore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, NanoXplore 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 NanoXplore will offset losses from the drop in NanoXplore's long position.| First Majestic vs. Precious Metals And | First Majestic vs. Thunderbird Entertainment Group | First Majestic vs. CNJ Capital Investments | First Majestic vs. Arbor Metals Corp |
| NanoXplore vs. Graphene Manufacturing Group | NanoXplore vs. Nano One Materials | NanoXplore vs. Coveo Solutions | NanoXplore vs. ZEN Graphene Solutions |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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