Correlation Between MAG Silver and Wishpond Technologies
Can any of the company-specific risk be diversified away by investing in both MAG Silver and Wishpond Technologies 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 MAG Silver and Wishpond Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAG Silver Corp and Wishpond Technologies, you can compare the effects of market volatilities on MAG Silver and Wishpond Technologies 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 MAG Silver with a short position of Wishpond Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAG Silver and Wishpond Technologies.
Diversification Opportunities for MAG Silver and Wishpond Technologies
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MAG and Wishpond is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding MAG Silver Corp and Wishpond Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wishpond Technologies and MAG 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 MAG Silver Corp are associated (or correlated) with Wishpond Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wishpond Technologies has no effect on the direction of MAG Silver i.e., MAG Silver and Wishpond Technologies go up and down completely randomly.
Pair Corralation between MAG Silver and Wishpond Technologies
Assuming the 90 days trading horizon MAG Silver Corp is expected to generate 0.63 times more return on investment than Wishpond Technologies. However, MAG Silver Corp is 1.58 times less risky than Wishpond Technologies. It trades about 0.04 of its potential returns per unit of risk. Wishpond Technologies is currently generating about -0.03 per unit of risk. If you would invest 1,646 in MAG Silver Corp on September 2, 2024 and sell it today you would earn a total of 534.00 from holding MAG Silver Corp or generate 32.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MAG Silver Corp vs. Wishpond Technologies
Performance |
| Timeline |
| MAG Silver Corp |
| Wishpond Technologies |
MAG Silver and Wishpond Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAG Silver and Wishpond Technologies
The main advantage of trading using opposite MAG Silver and Wishpond Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAG Silver position performs unexpectedly, Wishpond Technologies 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 Wishpond Technologies will offset losses from the drop in Wishpond Technologies' long position.| MAG Silver vs. First Majestic Silver | MAG Silver vs. Ivanhoe Energy | MAG Silver vs. Orezone Gold Corp | MAG Silver vs. Faraday Copper Corp |
| Wishpond Technologies vs. Moovly Media | Wishpond Technologies vs. Lite Access Technologies | Wishpond Technologies vs. Braille Energy Systems | Wishpond Technologies vs. Solar Alliance Energy |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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