Correlation Between Nexa Resources and Sociedad Minera
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By analyzing existing cross correlation between Nexa Resources Peru and Sociedad Minera Cerro, you can compare the effects of market volatilities on Nexa Resources and Sociedad Minera 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 Nexa Resources with a short position of Sociedad Minera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexa Resources and Sociedad Minera.
Diversification Opportunities for Nexa Resources and Sociedad Minera
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nexa and Sociedad is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Nexa Resources Peru and Sociedad Minera Cerro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sociedad Minera Cerro and Nexa Resources 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 Nexa Resources Peru are associated (or correlated) with Sociedad Minera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sociedad Minera Cerro has no effect on the direction of Nexa Resources i.e., Nexa Resources and Sociedad Minera go up and down completely randomly.
Pair Corralation between Nexa Resources and Sociedad Minera
Assuming the 90 days trading horizon Nexa Resources Peru is expected to under-perform the Sociedad Minera. In addition to that, Nexa Resources is 1.35 times more volatile than Sociedad Minera Cerro. It trades about 0.0 of its total potential returns per unit of risk. Sociedad Minera Cerro is currently generating about 0.07 per unit of volatility. If you would invest 2,901 in Sociedad Minera Cerro on August 31, 2024 and sell it today you would earn a total of 1,274 from holding Sociedad Minera Cerro or generate 43.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 66.39% |
| Values | Daily Returns |
Nexa Resources Peru vs. Sociedad Minera Cerro
Performance |
| Timeline |
| Nexa Resources Peru |
| Sociedad Minera Cerro |
Nexa Resources and Sociedad Minera Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexa Resources and Sociedad Minera
The main advantage of trading using opposite Nexa Resources and Sociedad Minera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexa Resources position performs unexpectedly, Sociedad Minera 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 Sociedad Minera will offset losses from the drop in Sociedad Minera's long position.The idea behind Nexa Resources Peru and Sociedad Minera Cerro pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sociedad Minera vs. Union Andina de | Sociedad Minera vs. Corporacion Aceros Arequipa | Sociedad Minera vs. ENGIE Energia Peru | Sociedad Minera vs. Citigroup |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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