Correlation Between SolGold PLC and First Majestic
Can any of the company-specific risk be diversified away by investing in both SolGold PLC and First Majestic 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 SolGold PLC and First Majestic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SolGold PLC and First Majestic Silver, you can compare the effects of market volatilities on SolGold PLC and First Majestic 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 SolGold PLC with a short position of First Majestic. Check out your portfolio center. Please also check ongoing floating volatility patterns of SolGold PLC and First Majestic.
Diversification Opportunities for SolGold PLC and First Majestic
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between SolGold and First is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding SolGold PLC and First Majestic Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Majestic Silver and SolGold PLC 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 SolGold PLC are associated (or correlated) with First Majestic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Majestic Silver has no effect on the direction of SolGold PLC i.e., SolGold PLC and First Majestic go up and down completely randomly.
Pair Corralation between SolGold PLC and First Majestic
If you would invest 877.00 in First Majestic Silver on September 13, 2024 and sell it today you would earn a total of 69.00 from holding First Majestic Silver or generate 7.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SolGold PLC vs. First Majestic Silver
Performance |
| Timeline |
| SolGold PLC |
| First Majestic Silver |
SolGold PLC and First Majestic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SolGold PLC and First Majestic
The main advantage of trading using opposite SolGold PLC and First Majestic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SolGold PLC position performs unexpectedly, First Majestic 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 First Majestic will offset losses from the drop in First Majestic's long position.| SolGold PLC vs. Lundin Gold | SolGold PLC vs. Trilogy Metals | SolGold PLC vs. Solaris Resources | SolGold PLC vs. Tudor Gold Corp |
| First Majestic vs. Ivanhoe Energy | First Majestic vs. Orezone Gold Corp | First Majestic 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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