Correlation Between First Majestic and Mirasol Resources
Can any of the company-specific risk be diversified away by investing in both First Majestic and Mirasol Resources 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 Mirasol Resources 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 Mirasol Resources, you can compare the effects of market volatilities on First Majestic and Mirasol Resources 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 Mirasol Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and Mirasol Resources.
Diversification Opportunities for First Majestic and Mirasol Resources
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and Mirasol is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and Mirasol Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirasol Resources 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 Mirasol Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirasol Resources has no effect on the direction of First Majestic i.e., First Majestic and Mirasol Resources go up and down completely randomly.
Pair Corralation between First Majestic and Mirasol Resources
Assuming the 90 days horizon First Majestic Silver is expected to under-perform the Mirasol Resources. In addition to that, First Majestic is 1.35 times more volatile than Mirasol Resources. It trades about -0.32 of its total potential returns per unit of risk. Mirasol Resources is currently generating about -0.34 per unit of volatility. If you would invest 46.00 in Mirasol Resources on August 25, 2024 and sell it today you would lose (7.00) from holding Mirasol Resources or give up 15.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
First Majestic Silver vs. Mirasol Resources
Performance |
| Timeline |
| First Majestic Silver |
| Mirasol Resources |
First Majestic and Mirasol Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and Mirasol Resources
The main advantage of trading using opposite First Majestic and Mirasol Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, Mirasol Resources 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 Mirasol Resources will offset losses from the drop in Mirasol Resources' long position.| First Majestic vs. Canadian General Investments | First Majestic vs. 2028 Investment Grade | First Majestic vs. Brookfield Investments | First Majestic vs. Upstart Investments |
| Mirasol Resources vs. First Majestic Silver | Mirasol Resources vs. Ivanhoe Energy | Mirasol Resources vs. Orezone Gold Corp | Mirasol Resources 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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