Correlation Between Metalla Royalty and SilverCrest Metals
Can any of the company-specific risk be diversified away by investing in both Metalla Royalty and SilverCrest Metals 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 Metalla Royalty and SilverCrest Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metalla Royalty Streaming and SilverCrest Metals, you can compare the effects of market volatilities on Metalla Royalty and SilverCrest Metals 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 Metalla Royalty with a short position of SilverCrest Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metalla Royalty and SilverCrest Metals.
Diversification Opportunities for Metalla Royalty and SilverCrest Metals
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Metalla and SilverCrest is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Metalla Royalty Streaming and SilverCrest Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SilverCrest Metals and Metalla Royalty 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 Metalla Royalty Streaming are associated (or correlated) with SilverCrest Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SilverCrest Metals has no effect on the direction of Metalla Royalty i.e., Metalla Royalty and SilverCrest Metals go up and down completely randomly.
Pair Corralation between Metalla Royalty and SilverCrest Metals
Assuming the 90 days horizon Metalla Royalty Streaming is expected to under-perform the SilverCrest Metals. In addition to that, Metalla Royalty is 1.01 times more volatile than SilverCrest Metals. It trades about -0.02 of its total potential returns per unit of risk. SilverCrest Metals is currently generating about 0.05 per unit of volatility. If you would invest 899.00 in SilverCrest Metals on August 27, 2024 and sell it today you would earn a total of 544.00 from holding SilverCrest Metals or generate 60.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metalla Royalty Streaming vs. SilverCrest Metals
Performance |
| Timeline |
| Metalla Royalty Streaming |
| SilverCrest Metals |
Metalla Royalty and SilverCrest Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metalla Royalty and SilverCrest Metals
The main advantage of trading using opposite Metalla Royalty and SilverCrest Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metalla Royalty position performs unexpectedly, SilverCrest Metals 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 SilverCrest Metals will offset losses from the drop in SilverCrest Metals' long position.| Metalla Royalty vs. Sandstorm Gold Ltd | Metalla Royalty vs. EMX Royalty Corp | Metalla Royalty vs. SilverCrest Metals | Metalla Royalty vs. GoldMining |
| SilverCrest Metals vs. First Majestic Silver | SilverCrest Metals vs. Ivanhoe Energy | SilverCrest Metals vs. Orezone Gold Corp | SilverCrest Metals 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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