Correlation Between Defiance Silver and Hecla Mining
Can any of the company-specific risk be diversified away by investing in both Defiance Silver and Hecla Mining 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 Defiance Silver and Hecla Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Defiance Silver Corp and Hecla Mining, you can compare the effects of market volatilities on Defiance Silver and Hecla Mining 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 Defiance Silver with a short position of Hecla Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Defiance Silver and Hecla Mining.
Diversification Opportunities for Defiance Silver and Hecla Mining
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Defiance and Hecla is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Defiance Silver Corp and Hecla Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hecla Mining and Defiance Silver 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 Defiance Silver Corp are associated (or correlated) with Hecla Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hecla Mining has no effect on the direction of Defiance Silver i.e., Defiance Silver and Hecla Mining go up and down completely randomly.
Pair Corralation between Defiance Silver and Hecla Mining
Assuming the 90 days horizon Defiance Silver Corp is expected to under-perform the Hecla Mining. In addition to that, Defiance Silver is 2.52 times more volatile than Hecla Mining. It trades about -0.1 of its total potential returns per unit of risk. Hecla Mining is currently generating about -0.16 per unit of volatility. If you would invest 630.00 in Hecla Mining on September 4, 2024 and sell it today you would lose (56.00) from holding Hecla Mining or give up 8.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Defiance Silver Corp vs. Hecla Mining
Performance |
| Timeline |
| Defiance Silver Corp |
| Hecla Mining |
Defiance Silver and Hecla Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Defiance Silver and Hecla Mining
The main advantage of trading using opposite Defiance Silver and Hecla Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Defiance Silver position performs unexpectedly, Hecla Mining 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 Hecla Mining will offset losses from the drop in Hecla Mining's long position.| Defiance Silver vs. Aftermath Silver | Defiance Silver vs. AbraSilver Resource Corp | Defiance Silver vs. Southern Silver Exploration | Defiance Silver vs. Blackrock Silver Corp |
| Hecla Mining vs. SilverCrest Metals | Hecla Mining vs. McEwen Mining | Hecla Mining vs. Avino Silver Gold | Hecla Mining vs. Metalla Royalty Streaming |
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.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |