Correlation Between First Majestic and Taseko Mines
Can any of the company-specific risk be diversified away by investing in both First Majestic and Taseko Mines 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 Taseko Mines 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 Taseko Mines, you can compare the effects of market volatilities on First Majestic and Taseko Mines 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 Taseko Mines. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and Taseko Mines.
Diversification Opportunities for First Majestic and Taseko Mines
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and Taseko is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and Taseko Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taseko Mines 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 Taseko Mines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taseko Mines has no effect on the direction of First Majestic i.e., First Majestic and Taseko Mines go up and down completely randomly.
Pair Corralation between First Majestic and Taseko Mines
Assuming the 90 days horizon First Majestic Silver is expected to generate 1.16 times more return on investment than Taseko Mines. However, First Majestic is 1.16 times more volatile than Taseko Mines. It trades about -0.03 of its potential returns per unit of risk. Taseko Mines is currently generating about -0.08 per unit of risk. If you would invest 859.00 in First Majestic Silver on November 3, 2024 and sell it today you would lose (31.00) from holding First Majestic Silver or give up 3.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Majestic Silver vs. Taseko Mines
Performance |
| Timeline |
| First Majestic Silver |
| Taseko Mines |
First Majestic and Taseko Mines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and Taseko Mines
The main advantage of trading using opposite First Majestic and Taseko Mines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, Taseko Mines 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 Taseko Mines will offset losses from the drop in Taseko Mines' long position.| First Majestic vs. Contagious Gaming | First Majestic vs. WELL Health Technologies | First Majestic vs. Champion Gaming Group | First Majestic vs. Advent Wireless |
| Taseko Mines vs. Capstone Mining Corp | Taseko Mines vs. Western Copper and | Taseko Mines vs. Imperial 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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