Correlation Between AstraZeneca PLC and First Majestic
Can any of the company-specific risk be diversified away by investing in both AstraZeneca PLC 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 AstraZeneca PLC and First Majestic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AstraZeneca PLC and First Majestic Silver, you can compare the effects of market volatilities on AstraZeneca PLC 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 AstraZeneca PLC with a short position of First Majestic. Check out your portfolio center. Please also check ongoing floating volatility patterns of AstraZeneca PLC and First Majestic.
Diversification Opportunities for AstraZeneca PLC and First Majestic
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AstraZeneca and First is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding AstraZeneca PLC 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 AstraZeneca PLC 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 AstraZeneca PLC 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 AstraZeneca PLC i.e., AstraZeneca PLC and First Majestic go up and down completely randomly.
Pair Corralation between AstraZeneca PLC and First Majestic
Assuming the 90 days trading horizon AstraZeneca PLC is expected to generate 1.66 times less return on investment than First Majestic. But when comparing it to its historical volatility, AstraZeneca PLC is 2.3 times less risky than First Majestic. It trades about 0.18 of its potential returns per unit of risk. First Majestic Silver is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 744.00 in First Majestic Silver on November 29, 2024 and sell it today you would earn a total of 72.00 from holding First Majestic Silver or generate 9.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AstraZeneca PLC vs. First Majestic Silver
Performance |
| Timeline |
| AstraZeneca PLC |
| First Majestic Silver |
AstraZeneca PLC and First Majestic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AstraZeneca PLC and First Majestic
The main advantage of trading using opposite AstraZeneca PLC and First Majestic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AstraZeneca PLC 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.| AstraZeneca PLC vs. Atalaya Mining | AstraZeneca PLC vs. CNH Industrial NV | AstraZeneca PLC vs. Eastinco Mining Exploration | AstraZeneca PLC vs. Universal Music Group |
| First Majestic vs. Ecofin Global Utilities | First Majestic vs. Jupiter Fund Management | First Majestic vs. Fresenius Medical Care | First Majestic vs. Abingdon Health Plc |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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