Correlation Between Hudbay Minerals and Amerigo Resources
Can any of the company-specific risk be diversified away by investing in both Hudbay Minerals and Amerigo Resources 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 Hudbay Minerals and Amerigo Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hudbay Minerals and Amerigo Resources, you can compare the effects of market volatilities on Hudbay Minerals and Amerigo Resources 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 Hudbay Minerals with a short position of Amerigo Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hudbay Minerals and Amerigo Resources.
Diversification Opportunities for Hudbay Minerals and Amerigo Resources
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hudbay and Amerigo is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Hudbay Minerals and Amerigo Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amerigo Resources and Hudbay Minerals 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 Hudbay Minerals are associated (or correlated) with Amerigo Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amerigo Resources has no effect on the direction of Hudbay Minerals i.e., Hudbay Minerals and Amerigo Resources go up and down completely randomly.
Pair Corralation between Hudbay Minerals and Amerigo Resources
Considering the 90-day investment horizon Hudbay Minerals is expected to under-perform the Amerigo Resources. In addition to that, Hudbay Minerals is 1.48 times more volatile than Amerigo Resources. It trades about -0.07 of its total potential returns per unit of risk. Amerigo Resources is currently generating about -0.05 per unit of volatility. If you would invest 126.00 in Amerigo Resources on August 27, 2024 and sell it today you would lose (3.00) from holding Amerigo Resources or give up 2.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hudbay Minerals vs. Amerigo Resources
Performance |
| Timeline |
| Hudbay Minerals |
| Amerigo Resources |
Hudbay Minerals and Amerigo Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hudbay Minerals and Amerigo Resources
The main advantage of trading using opposite Hudbay Minerals and Amerigo Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hudbay Minerals position performs unexpectedly, Amerigo Resources 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 Amerigo Resources will offset losses from the drop in Amerigo Resources' long position.| Hudbay Minerals vs. Labrador Gold Corp | Hudbay Minerals vs. Aurion Resources | Hudbay Minerals vs. Puma Exploration | Hudbay Minerals vs. Golden Star Resource |
| Amerigo Resources vs. Ascendant Resources | Amerigo Resources vs. Cantex Mine Development | Amerigo Resources vs. Amarc Resources | Amerigo Resources vs. Sterling 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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