Correlation Between First Majestic and Plato Gold
Can any of the company-specific risk be diversified away by investing in both First Majestic and Plato 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 Plato 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 Plato Gold Corp, you can compare the effects of market volatilities on First Majestic and Plato 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 Plato Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and Plato Gold.
Diversification Opportunities for First Majestic and Plato Gold
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and Plato is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and Plato Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plato Gold 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 Plato Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plato Gold Corp has no effect on the direction of First Majestic i.e., First Majestic and Plato Gold go up and down completely randomly.
Pair Corralation between First Majestic and Plato Gold
Assuming the 90 days horizon First Majestic Silver is expected to under-perform the Plato Gold. But the stock apears to be less risky and, when comparing its historical volatility, First Majestic Silver is 6.6 times less risky than Plato Gold. The stock trades about -0.35 of its potential returns per unit of risk. The Plato Gold Corp is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2.00 in Plato Gold Corp on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Plato Gold Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Majestic Silver vs. Plato Gold Corp
Performance |
| Timeline |
| First Majestic Silver |
| Plato Gold Corp |
First Majestic and Plato Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and Plato Gold
The main advantage of trading using opposite First Majestic and Plato Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, Plato 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 Plato Gold will offset losses from the drop in Plato Gold's long position.| First Majestic vs. Quisitive Technology Solutions | First Majestic vs. Canso Select Opportunities | First Majestic vs. Canadian General Investments | First Majestic vs. Sparx Technology |
| Plato Gold vs. Q Gold Resources | Plato Gold vs. MAS Gold Corp | Plato Gold vs. ExGen Resources | Plato Gold vs. Carlin Gold |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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