Correlation Between First Majestic and Opus One
Can any of the company-specific risk be diversified away by investing in both First Majestic and Opus One 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 Opus One 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 Opus One Resources, you can compare the effects of market volatilities on First Majestic and Opus One 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 Opus One. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and Opus One.
Diversification Opportunities for First Majestic and Opus One
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and Opus is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and Opus One Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Opus One 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 Opus One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Opus One Resources has no effect on the direction of First Majestic i.e., First Majestic and Opus One go up and down completely randomly.
Pair Corralation between First Majestic and Opus One
Assuming the 90 days horizon First Majestic is expected to generate 111.29 times less return on investment than Opus One. But when comparing it to its historical volatility, First Majestic Silver is 5.68 times less risky than Opus One. It trades about 0.0 of its potential returns per unit of risk. Opus One Resources is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1.00 in Opus One Resources on September 13, 2024 and sell it today you would earn a total of 3.50 from holding Opus One Resources or generate 350.0% 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. Opus One Resources
Performance |
| Timeline |
| First Majestic Silver |
| Opus One Resources |
First Majestic and Opus One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and Opus One
The main advantage of trading using opposite First Majestic and Opus One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, Opus One 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 Opus One will offset losses from the drop in Opus One's long position.| First Majestic vs. Ivanhoe Energy | First Majestic vs. Orezone Gold Corp | First Majestic vs. Faraday Copper Corp |
| Opus One vs. Leveljump Healthcare Corp | Opus One vs. NeuPath Health | Opus One vs. Advent Wireless | Opus One vs. Nova Leap Health |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |