Correlation Between MAG SILVER and Hongkong
Can any of the company-specific risk be diversified away by investing in both MAG SILVER and Hongkong 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 Hongkong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAG SILVER and The Hongkong and, you can compare the effects of market volatilities on MAG SILVER and Hongkong 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 Hongkong. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAG SILVER and Hongkong.
Diversification Opportunities for MAG SILVER and Hongkong
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MAG and Hongkong is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding MAG SILVER and The Hongkong and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Hongkong 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 are associated (or correlated) with Hongkong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Hongkong has no effect on the direction of MAG SILVER i.e., MAG SILVER and Hongkong go up and down completely randomly.
Pair Corralation between MAG SILVER and Hongkong
Assuming the 90 days trading horizon MAG SILVER is expected to generate 0.96 times more return on investment than Hongkong. However, MAG SILVER is 1.04 times less risky than Hongkong. It trades about 0.12 of its potential returns per unit of risk. The Hongkong and is currently generating about 0.05 per unit of risk. If you would invest 1,097 in MAG SILVER on November 7, 2024 and sell it today you would earn a total of 443.00 from holding MAG SILVER or generate 40.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.37% |
| Values | Daily Returns |
MAG SILVER vs. The Hongkong and
Performance |
| Timeline |
| MAG SILVER |
| The Hongkong |
MAG SILVER and Hongkong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAG SILVER and Hongkong
The main advantage of trading using opposite MAG SILVER and Hongkong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAG SILVER position performs unexpectedly, Hongkong 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 Hongkong will offset losses from the drop in Hongkong's long position.| MAG SILVER vs. SIVERS SEMICONDUCTORS AB | MAG SILVER vs. NorAm Drilling AS | MAG SILVER vs. Volkswagen AG | MAG SILVER vs. Darden Restaurants |
| Hongkong vs. Marriott International | Hongkong vs. Hilton Worldwide Holdings | Hongkong vs. H World Group | Hongkong vs. Hyatt Hotels |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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