Correlation Between EMX Royalty and ERAMET SA
Can any of the company-specific risk be diversified away by investing in both EMX Royalty and ERAMET SA 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 EMX Royalty and ERAMET SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EMX Royalty Corp and ERAMET SA, you can compare the effects of market volatilities on EMX Royalty and ERAMET SA 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 EMX Royalty with a short position of ERAMET SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMX Royalty and ERAMET SA.
Diversification Opportunities for EMX Royalty and ERAMET SA
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between EMX and ERAMET is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding EMX Royalty Corp and ERAMET SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ERAMET SA and EMX Royalty 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 EMX Royalty Corp are associated (or correlated) with ERAMET SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ERAMET SA has no effect on the direction of EMX Royalty i.e., EMX Royalty and ERAMET SA go up and down completely randomly.
Pair Corralation between EMX Royalty and ERAMET SA
Considering the 90-day investment horizon EMX Royalty Corp is expected to generate 7.34 times more return on investment than ERAMET SA. However, EMX Royalty is 7.34 times more volatile than ERAMET SA. It trades about 0.08 of its potential returns per unit of risk. ERAMET SA is currently generating about -0.22 per unit of risk. If you would invest 170.00 in EMX Royalty Corp on November 29, 2024 and sell it today you would earn a total of 5.00 from holding EMX Royalty Corp or generate 2.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
EMX Royalty Corp vs. ERAMET SA
Performance |
| Timeline |
| EMX Royalty Corp |
| ERAMET SA |
EMX Royalty and ERAMET SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EMX Royalty and ERAMET SA
The main advantage of trading using opposite EMX Royalty and ERAMET SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EMX Royalty position performs unexpectedly, ERAMET SA 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 ERAMET SA will offset losses from the drop in ERAMET SA's long position.| EMX Royalty vs. Metalla Royalty Streaming | EMX Royalty vs. Osisko Gold Ro | EMX Royalty vs. Equinox Gold Corp |
| ERAMET SA vs. Iluka Resources Ltd | ERAMET SA vs. Giyani Metals Corp | ERAMET SA vs. IGO Limited | ERAMET SA vs. Grid Metals Corp |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |