Correlation Between First Majestic and Minaurum Gold
Can any of the company-specific risk be diversified away by investing in both First Majestic and Minaurum Gold 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 Minaurum Gold 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 Minaurum Gold, you can compare the effects of market volatilities on First Majestic and Minaurum Gold 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 Minaurum Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and Minaurum Gold.
Diversification Opportunities for First Majestic and Minaurum Gold
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and Minaurum is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and Minaurum Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minaurum Gold 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 Minaurum Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minaurum Gold has no effect on the direction of First Majestic i.e., First Majestic and Minaurum Gold go up and down completely randomly.
Pair Corralation between First Majestic and Minaurum Gold
Assuming the 90 days horizon First Majestic Silver is expected to generate 0.71 times more return on investment than Minaurum Gold. However, First Majestic Silver is 1.41 times less risky than Minaurum Gold. It trades about -0.03 of its potential returns per unit of risk. Minaurum Gold is currently generating about -0.04 per unit of risk. If you would invest 892.00 in First Majestic Silver on November 3, 2024 and sell it today you would lose (64.00) from holding First Majestic Silver or give up 7.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Majestic Silver vs. Minaurum Gold
Performance |
| Timeline |
| First Majestic Silver |
| Minaurum Gold |
First Majestic and Minaurum Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and Minaurum Gold
The main advantage of trading using opposite First Majestic and Minaurum Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, Minaurum Gold 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 Minaurum Gold will offset losses from the drop in Minaurum Gold's long position.| First Majestic vs. Contagious Gaming | First Majestic vs. WELL Health Technologies | First Majestic vs. Champion Gaming Group | First Majestic vs. Advent Wireless |
| Minaurum Gold vs. Defiance Silver Corp | Minaurum Gold vs. Altiplano Metals | Minaurum Gold vs. Independence Gold Corp | Minaurum Gold vs. Galway Metals |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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