Correlation Between Almaden Minerals and First Majestic

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Almaden Minerals and First Majestic 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 Almaden Minerals and First Majestic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Almaden Minerals and First Majestic Silver, you can compare the effects of market volatilities on Almaden Minerals and First Majestic 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 Almaden Minerals with a short position of First Majestic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Almaden Minerals and First Majestic.

Diversification Opportunities for Almaden Minerals and First Majestic

0.38
  Correlation Coefficient

Weak diversification

The 3 months correlation between Almaden and First is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Almaden Minerals and First Majestic Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Majestic Silver and Almaden Minerals 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 Almaden Minerals are associated (or correlated) with First Majestic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Majestic Silver has no effect on the direction of Almaden Minerals i.e., Almaden Minerals and First Majestic go up and down completely randomly.

Pair Corralation between Almaden Minerals and First Majestic

Assuming the 90 days trading horizon Almaden Minerals is expected to under-perform the First Majestic. In addition to that, Almaden Minerals is 1.81 times more volatile than First Majestic Silver. It trades about -0.02 of its total potential returns per unit of risk. First Majestic Silver is currently generating about 0.03 per unit of volatility. If you would invest  761.00  in First Majestic Silver on September 1, 2024 and sell it today you would earn a total of  107.00  from holding First Majestic Silver or generate 14.06% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Almaden Minerals  vs.  First Majestic Silver

 Performance 
       Timeline  
Almaden Minerals 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Almaden Minerals are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating primary indicators, Almaden Minerals may actually be approaching a critical reversion point that can send shares even higher in December 2024.
First Majestic Silver 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in First Majestic Silver are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, First Majestic displayed solid returns over the last few months and may actually be approaching a breakup point.

Almaden Minerals and First Majestic Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Almaden Minerals and First Majestic

The main advantage of trading using opposite Almaden Minerals and First Majestic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Almaden Minerals position performs unexpectedly, First Majestic 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 First Majestic will offset losses from the drop in First Majestic's long position.
The idea behind Almaden Minerals and First Majestic Silver pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Stocks Directory module to find actively traded stocks across global markets.

Other Complementary Tools

Share Portfolio
Track or share privately all of your investments from the convenience of any device
Equity Forecasting
Use basic forecasting models to generate price predictions and determine price momentum
Equity Valuation
Check real value of public entities based on technical and fundamental data
Watchlist Optimization
Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm
Insider Screener
Find insiders across different sectors to evaluate their impact on performance