Correlation Between Silver X and Benton Resources
Can any of the company-specific risk be diversified away by investing in both Silver X and Benton 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 Silver X and Benton Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Silver X Mining and Benton Resources, you can compare the effects of market volatilities on Silver X and Benton 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 Silver X with a short position of Benton Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silver X and Benton Resources.
Diversification Opportunities for Silver X and Benton Resources
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Silver and Benton is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Silver X Mining and Benton Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Benton Resources and Silver X 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 Silver X Mining are associated (or correlated) with Benton Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Benton Resources has no effect on the direction of Silver X i.e., Silver X and Benton Resources go up and down completely randomly.
Pair Corralation between Silver X and Benton Resources
Assuming the 90 days horizon Silver X is expected to generate 139.63 times less return on investment than Benton Resources. But when comparing it to its historical volatility, Silver X Mining is 3.76 times less risky than Benton Resources. It trades about 0.0 of its potential returns per unit of risk. Benton Resources is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 8.00 in Benton Resources on August 29, 2024 and sell it today you would lose (3.00) from holding Benton Resources or give up 37.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Silver X Mining vs. Benton Resources
Performance |
| Timeline |
| Silver X Mining |
| Benton Resources |
Silver X and Benton Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Silver X and Benton Resources
The main advantage of trading using opposite Silver X and Benton Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Silver X position performs unexpectedly, Benton 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 Benton Resources will offset losses from the drop in Benton Resources' long position.| Silver X vs. Aurelia Metals Limited | Silver X vs. Artemis Resources | Silver X vs. Azimut Exploration | Silver X vs. Champion Bear Resources |
| Benton Resources vs. Silver Hammer Mining | Benton Resources vs. Reyna Silver Corp | Benton Resources vs. Guanajuato Silver | Benton Resources vs. Silver One Resources |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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