Correlation Between GM and Mantaro Silver
Can any of the company-specific risk be diversified away by investing in both GM and Mantaro 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 GM and Mantaro Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Mantaro Silver Corp, you can compare the effects of market volatilities on GM and Mantaro 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 GM with a short position of Mantaro Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Mantaro Silver.
Diversification Opportunities for GM and Mantaro Silver
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and Mantaro is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Mantaro Silver Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mantaro Silver Corp and GM 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 General Motors are associated (or correlated) with Mantaro Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mantaro Silver Corp has no effect on the direction of GM i.e., GM and Mantaro Silver go up and down completely randomly.
Pair Corralation between GM and Mantaro Silver
Allowing for the 90-day total investment horizon GM is expected to generate 6.11 times less return on investment than Mantaro Silver. But when comparing it to its historical volatility, General Motors is 7.79 times less risky than Mantaro Silver. It trades about 0.05 of its potential returns per unit of risk. Mantaro Silver Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 40.00 in Mantaro Silver Corp on September 3, 2024 and sell it today you would lose (32.31) from holding Mantaro Silver Corp or give up 80.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
General Motors vs. Mantaro Silver Corp
Performance |
| Timeline |
| General Motors |
| Mantaro Silver Corp |
GM and Mantaro Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Mantaro Silver
The main advantage of trading using opposite GM and Mantaro Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Mantaro 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 Mantaro Silver will offset losses from the drop in Mantaro Silver's long position.The idea behind General Motors and Mantaro Silver Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Mantaro Silver vs. Star Royalties | Mantaro Silver vs. Defiance Silver Corp | Mantaro Silver vs. Diamond Fields Resources | Mantaro Silver vs. GoGold Resources |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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