Correlation Between Amerigo Resources and Taseko Mines
Can any of the company-specific risk be diversified away by investing in both Amerigo Resources 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 Amerigo Resources and Taseko Mines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amerigo Resources and Taseko Mines, you can compare the effects of market volatilities on Amerigo Resources 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 Amerigo Resources with a short position of Taseko Mines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amerigo Resources and Taseko Mines.
Diversification Opportunities for Amerigo Resources and Taseko Mines
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Amerigo and Taseko is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Amerigo Resources and Taseko Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taseko Mines and Amerigo Resources 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 Amerigo Resources 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 Amerigo Resources i.e., Amerigo Resources and Taseko Mines go up and down completely randomly.
Pair Corralation between Amerigo Resources and Taseko Mines
Assuming the 90 days horizon Amerigo Resources is expected to generate 1.22 times less return on investment than Taseko Mines. But when comparing it to its historical volatility, Amerigo Resources is 1.31 times less risky than Taseko Mines. It trades about 0.04 of its potential returns per unit of risk. Taseko Mines is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 136.00 in Taseko Mines on August 25, 2024 and sell it today you would earn a total of 72.00 from holding Taseko Mines or generate 52.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amerigo Resources vs. Taseko Mines
Performance |
| Timeline |
| Amerigo Resources |
| Taseko Mines |
Amerigo Resources and Taseko Mines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amerigo Resources and Taseko Mines
The main advantage of trading using opposite Amerigo Resources and Taseko Mines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amerigo Resources 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.| Amerigo Resources vs. First Quantum Minerals | Amerigo Resources vs. Antofagasta PLC | Amerigo Resources vs. Capstone Copper Corp | Amerigo Resources vs. Copper Mountain Mining |
| Taseko Mines vs. Capstone Copper Corp | Taseko Mines vs. Hudbay Minerals | Taseko Mines vs. Ero Copper Corp | Taseko Mines vs. CopperCorp 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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