Correlation Between Minco Silver and Aura Minerals
Can any of the company-specific risk be diversified away by investing in both Minco Silver and Aura Minerals 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 Minco Silver and Aura Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Minco Silver and Aura Minerals, you can compare the effects of market volatilities on Minco Silver and Aura Minerals 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 Minco Silver with a short position of Aura Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Minco Silver and Aura Minerals.
Diversification Opportunities for Minco Silver and Aura Minerals
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Minco and Aura is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Minco Silver and Aura Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aura Minerals and Minco 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 Minco Silver are associated (or correlated) with Aura Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aura Minerals has no effect on the direction of Minco Silver i.e., Minco Silver and Aura Minerals go up and down completely randomly.
Pair Corralation between Minco Silver and Aura Minerals
Assuming the 90 days trading horizon Minco Silver is expected to generate 1.58 times less return on investment than Aura Minerals. In addition to that, Minco Silver is 2.14 times more volatile than Aura Minerals. It trades about 0.03 of its total potential returns per unit of risk. Aura Minerals is currently generating about 0.12 per unit of volatility. If you would invest 922.00 in Aura Minerals on August 29, 2024 and sell it today you would earn a total of 816.00 from holding Aura Minerals or generate 88.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Minco Silver vs. Aura Minerals
Performance |
| Timeline |
| Minco Silver |
| Aura Minerals |
Minco Silver and Aura Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Minco Silver and Aura Minerals
The main advantage of trading using opposite Minco Silver and Aura Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Minco Silver position performs unexpectedly, Aura Minerals 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 Aura Minerals will offset losses from the drop in Aura Minerals' long position.| Minco Silver vs. Excellon Resources | Minco Silver vs. IMPACT Silver Corp | Minco Silver vs. Almaden Minerals | Minco Silver vs. Bear Creek Mining |
| Aura Minerals vs. Entree Resources | Aura Minerals vs. Wesdome Gold Mines | Aura Minerals vs. Eastern Platinum Limited | Aura Minerals vs. Platinum Group Metals |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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