Correlation Between Jamieson Wellness and First Majestic
Can any of the company-specific risk be diversified away by investing in both Jamieson Wellness 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 Jamieson Wellness and First Majestic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jamieson Wellness and First Majestic Silver, you can compare the effects of market volatilities on Jamieson Wellness 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 Jamieson Wellness with a short position of First Majestic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jamieson Wellness and First Majestic.
Diversification Opportunities for Jamieson Wellness and First Majestic
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jamieson and First is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Jamieson Wellness 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 Jamieson Wellness 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 Jamieson Wellness 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 Jamieson Wellness i.e., Jamieson Wellness and First Majestic go up and down completely randomly.
Pair Corralation between Jamieson Wellness and First Majestic
Assuming the 90 days trading horizon Jamieson Wellness is expected to generate 2.13 times less return on investment than First Majestic. But when comparing it to its historical volatility, Jamieson Wellness is 2.35 times less risky than First Majestic. It trades about 0.11 of its potential returns per unit of risk. First Majestic Silver is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 785.00 in First Majestic Silver on September 12, 2024 and sell it today you would earn a total of 161.00 from holding First Majestic Silver or generate 20.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jamieson Wellness vs. First Majestic Silver
Performance |
| Timeline |
| Jamieson Wellness |
| First Majestic Silver |
Jamieson Wellness and First Majestic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jamieson Wellness and First Majestic
The main advantage of trading using opposite Jamieson Wellness and First Majestic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jamieson Wellness 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.| Jamieson Wellness vs. Leons Furniture Limited | Jamieson Wellness vs. Autocanada | Jamieson Wellness vs. Maple Leaf Foods | Jamieson Wellness vs. Premium Brands Holdings |
| First Majestic vs. Ivanhoe Energy | First Majestic vs. Orezone Gold Corp | First Majestic vs. Faraday Copper 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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