Correlation Between Fortuna Silver and Puma Exploration
Can any of the company-specific risk be diversified away by investing in both Fortuna Silver and Puma Exploration 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 Fortuna Silver and Puma Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fortuna Silver Mines and Puma Exploration, you can compare the effects of market volatilities on Fortuna Silver and Puma Exploration 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 Fortuna Silver with a short position of Puma Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortuna Silver and Puma Exploration.
Diversification Opportunities for Fortuna Silver and Puma Exploration
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Fortuna and Puma is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Fortuna Silver Mines and Puma Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puma Exploration and Fortuna 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 Fortuna Silver Mines are associated (or correlated) with Puma Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puma Exploration has no effect on the direction of Fortuna Silver i.e., Fortuna Silver and Puma Exploration go up and down completely randomly.
Pair Corralation between Fortuna Silver and Puma Exploration
Considering the 90-day investment horizon Fortuna Silver Mines is expected to generate 0.46 times more return on investment than Puma Exploration. However, Fortuna Silver Mines is 2.19 times less risky than Puma Exploration. It trades about 0.04 of its potential returns per unit of risk. Puma Exploration is currently generating about 0.01 per unit of risk. If you would invest 349.00 in Fortuna Silver Mines on September 1, 2024 and sell it today you would earn a total of 129.00 from holding Fortuna Silver Mines or generate 36.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fortuna Silver Mines vs. Puma Exploration
Performance |
| Timeline |
| Fortuna Silver Mines |
| Puma Exploration |
Fortuna Silver and Puma Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fortuna Silver and Puma Exploration
The main advantage of trading using opposite Fortuna Silver and Puma Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortuna Silver position performs unexpectedly, Puma Exploration 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 Puma Exploration will offset losses from the drop in Puma Exploration's long position.| Fortuna Silver vs. Pan American Silver | Fortuna Silver vs. Harmony Gold Mining | Fortuna Silver vs. IAMGold | Fortuna Silver vs. Kinross Gold |
| Puma Exploration vs. Aurion Resources | Puma Exploration vs. Rio2 Limited | Puma Exploration vs. Palamina Corp | Puma Exploration vs. BTU 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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