Correlation Between Flinders Resources and Americas Silver
Can any of the company-specific risk be diversified away by investing in both Flinders Resources and Americas Silver 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 Flinders Resources and Americas Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flinders Resources Limited and Americas Silver Corp, you can compare the effects of market volatilities on Flinders Resources and Americas Silver 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 Flinders Resources with a short position of Americas Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flinders Resources and Americas Silver.
Diversification Opportunities for Flinders Resources and Americas Silver
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Flinders and Americas is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Flinders Resources Limited and Americas Silver Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Americas Silver Corp and Flinders 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 Flinders Resources Limited are associated (or correlated) with Americas Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Americas Silver Corp has no effect on the direction of Flinders Resources i.e., Flinders Resources and Americas Silver go up and down completely randomly.
Pair Corralation between Flinders Resources and Americas Silver
Assuming the 90 days horizon Flinders Resources is expected to generate 1.04 times less return on investment than Americas Silver. But when comparing it to its historical volatility, Flinders Resources Limited is 1.42 times less risky than Americas Silver. It trades about 0.13 of its potential returns per unit of risk. Americas Silver Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 3.34 in Americas Silver Corp on October 9, 2024 and sell it today you would earn a total of 54.66 from holding Americas Silver Corp or generate 1636.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flinders Resources Limited vs. Americas Silver Corp
Performance |
| Timeline |
| Flinders Resources |
| Americas Silver Corp |
Flinders Resources and Americas Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flinders Resources and Americas Silver
The main advantage of trading using opposite Flinders Resources and Americas Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flinders Resources position performs unexpectedly, Americas Silver 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 Americas Silver will offset losses from the drop in Americas Silver's long position.| Flinders Resources vs. Maple Leaf Foods | Flinders Resources vs. Arbor Metals Corp | Flinders Resources vs. Ramp Metals | Flinders Resources vs. Aya Gold Silver |
| Americas Silver vs. Excellon Resources | Americas Silver vs. GoGold Resources | Americas Silver vs. Fortuna Silver Mines | Americas Silver vs. Dolly Varden Silver |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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