Correlation Between Americas Gold and Silvercorp Metals
Can any of the company-specific risk be diversified away by investing in both Americas Gold and Silvercorp 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 Americas Gold and Silvercorp Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Americas Gold and and Silvercorp Metals, you can compare the effects of market volatilities on Americas Gold and Silvercorp 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 Americas Gold with a short position of Silvercorp Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Americas Gold and Silvercorp Metals.
Diversification Opportunities for Americas Gold and Silvercorp Metals
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Americas and Silvercorp is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Americas Gold and and Silvercorp Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silvercorp Metals and Americas Gold 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 Americas Gold and are associated (or correlated) with Silvercorp Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silvercorp Metals has no effect on the direction of Americas Gold i.e., Americas Gold and Silvercorp Metals go up and down completely randomly.
Pair Corralation between Americas Gold and Silvercorp Metals
Assuming the 90 days trading horizon Americas Gold and is expected to generate 2.28 times more return on investment than Silvercorp Metals. However, Americas Gold is 2.28 times more volatile than Silvercorp Metals. It trades about -0.05 of its potential returns per unit of risk. Silvercorp Metals is currently generating about -0.23 per unit of risk. If you would invest 38.00 in Americas Gold and on September 23, 2024 and sell it today you would lose (3.00) from holding Americas Gold and or give up 7.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Americas Gold and vs. Silvercorp Metals
Performance |
| Timeline |
| Americas Gold |
| Silvercorp Metals |
Americas Gold and Silvercorp Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Americas Gold and Silvercorp Metals
The main advantage of trading using opposite Americas Gold and Silvercorp Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Americas Gold position performs unexpectedly, Silvercorp 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 Silvercorp Metals will offset losses from the drop in Silvercorp Metals' long position.| Americas Gold vs. Pan American Silver | Americas Gold vs. First Majestic Silver | Americas Gold vs. MAG Silver Corp | Americas Gold vs. Silvercorp Metals |
| Silvercorp Metals vs. Pan American Silver | Silvercorp Metals vs. First Majestic Silver | Silvercorp Metals vs. MAG Silver Corp | Silvercorp Metals vs. Endeavour Silver 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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