Correlation Between First Majestic and VIENNA INSURANCE
Can any of the company-specific risk be diversified away by investing in both First Majestic and VIENNA INSURANCE 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 First Majestic and VIENNA INSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Majestic Silver and VIENNA INSURANCE GR, you can compare the effects of market volatilities on First Majestic and VIENNA INSURANCE 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 First Majestic with a short position of VIENNA INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and VIENNA INSURANCE.
Diversification Opportunities for First Majestic and VIENNA INSURANCE
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between First and VIENNA is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and VIENNA INSURANCE GR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VIENNA INSURANCE and First Majestic 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 First Majestic Silver are associated (or correlated) with VIENNA INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VIENNA INSURANCE has no effect on the direction of First Majestic i.e., First Majestic and VIENNA INSURANCE go up and down completely randomly.
Pair Corralation between First Majestic and VIENNA INSURANCE
Assuming the 90 days horizon First Majestic Silver is expected to generate 5.19 times more return on investment than VIENNA INSURANCE. However, First Majestic is 5.19 times more volatile than VIENNA INSURANCE GR. It trades about 0.04 of its potential returns per unit of risk. VIENNA INSURANCE GR is currently generating about 0.1 per unit of risk. If you would invest 484.00 in First Majestic Silver on October 11, 2024 and sell it today you would earn a total of 99.00 from holding First Majestic Silver or generate 20.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Majestic Silver vs. VIENNA INSURANCE GR
Performance |
| Timeline |
| First Majestic Silver |
| VIENNA INSURANCE |
First Majestic and VIENNA INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and VIENNA INSURANCE
The main advantage of trading using opposite First Majestic and VIENNA INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, VIENNA INSURANCE 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 VIENNA INSURANCE will offset losses from the drop in VIENNA INSURANCE's long position.| First Majestic vs. VIENNA INSURANCE GR | First Majestic vs. INDOFOOD AGRI RES | First Majestic vs. THAI BEVERAGE | First Majestic vs. Reinsurance Group of |
| VIENNA INSURANCE vs. SENECA FOODS A | VIENNA INSURANCE vs. AGF Management Limited | VIENNA INSURANCE vs. Astral Foods Limited | VIENNA INSURANCE vs. Tyson Foods |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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