Correlation Between GMxico Transportes and First Majestic
Can any of the company-specific risk be diversified away by investing in both GMxico Transportes and First Majestic 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 GMxico Transportes and First Majestic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GMxico Transportes SAB and First Majestic Silver, you can compare the effects of market volatilities on GMxico Transportes and First Majestic 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 GMxico Transportes with a short position of First Majestic. Check out your portfolio center. Please also check ongoing floating volatility patterns of GMxico Transportes and First Majestic.
Diversification Opportunities for GMxico Transportes and First Majestic
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GMxico and First is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding GMxico Transportes SAB and First Majestic Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Majestic Silver and GMxico Transportes 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 GMxico Transportes SAB are associated (or correlated) with First Majestic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Majestic Silver has no effect on the direction of GMxico Transportes i.e., GMxico Transportes and First Majestic go up and down completely randomly.
Pair Corralation between GMxico Transportes and First Majestic
Assuming the 90 days trading horizon GMxico Transportes SAB is expected to generate 2.72 times more return on investment than First Majestic. However, GMxico Transportes is 2.72 times more volatile than First Majestic Silver. It trades about 0.02 of its potential returns per unit of risk. First Majestic Silver is currently generating about -0.13 per unit of risk. If you would invest 3,060 in GMxico Transportes SAB on August 29, 2024 and sell it today you would earn a total of 10.00 from holding GMxico Transportes SAB or generate 0.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GMxico Transportes SAB vs. First Majestic Silver
Performance |
| Timeline |
| GMxico Transportes SAB |
| First Majestic Silver |
GMxico Transportes and First Majestic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GMxico Transportes and First Majestic
The main advantage of trading using opposite GMxico Transportes and First Majestic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GMxico Transportes position performs unexpectedly, First Majestic 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 First Majestic will offset losses from the drop in First Majestic's long position.| GMxico Transportes vs. Glencore plc | GMxico Transportes vs. iShares Trust | GMxico Transportes vs. US Bancorp | GMxico Transportes vs. American Express |
| First Majestic vs. Visa Inc | First Majestic vs. Desarrolladora Homex SAB | First Majestic vs. CMR SAB de | First Majestic vs. The Select Sector |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |