Correlation Between First Majestic and Thesis Gold
Can any of the company-specific risk be diversified away by investing in both First Majestic and Thesis 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 Thesis 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 Thesis Gold, you can compare the effects of market volatilities on First Majestic and Thesis 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 Thesis Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and Thesis Gold.
Diversification Opportunities for First Majestic and Thesis Gold
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between First and Thesis is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and Thesis Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thesis 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 Thesis Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thesis Gold has no effect on the direction of First Majestic i.e., First Majestic and Thesis Gold go up and down completely randomly.
Pair Corralation between First Majestic and Thesis Gold
Assuming the 90 days horizon First Majestic Silver is expected to generate 0.9 times more return on investment than Thesis Gold. However, First Majestic Silver is 1.11 times less risky than Thesis Gold. It trades about -0.01 of its potential returns per unit of risk. Thesis Gold is currently generating about -0.02 per unit of risk. If you would invest 967.00 in First Majestic Silver on September 1, 2024 and sell it today you would lose (99.00) from holding First Majestic Silver or give up 10.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Majestic Silver vs. Thesis Gold
Performance |
| Timeline |
| First Majestic Silver |
| Thesis Gold |
First Majestic and Thesis Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and Thesis Gold
The main advantage of trading using opposite First Majestic and Thesis Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, Thesis 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 Thesis Gold will offset losses from the drop in Thesis Gold's long position.| First Majestic vs. Slate Grocery REIT | First Majestic vs. Toronto Dominion Bank | First Majestic vs. Enduro Metals Corp | First Majestic vs. Intact Financial Corp |
| Thesis Gold vs. Lion One Metals | Thesis Gold vs. Goliath Resources | Thesis Gold vs. Dolly Varden Silver | Thesis Gold vs. Nevada King 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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