Correlation Between Silvercorp Metals and Triad Group

Can any of the company-specific risk be diversified away by investing in both Silvercorp Metals and Triad Group 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 Silvercorp Metals and Triad Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Silvercorp Metals and Triad Group PLC, you can compare the effects of market volatilities on Silvercorp Metals and Triad Group 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 Silvercorp Metals with a short position of Triad Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silvercorp Metals and Triad Group.

Diversification Opportunities for Silvercorp Metals and Triad Group

0.16

Correlation Coefficient

Silvercorp Metals  Triad Group

Average diversification

The 3 months correlation between Silvercorp and Triad is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Silvercorp Metals and Triad Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triad Group PLC and Silvercorp Metals 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 Silvercorp Metals are associated (or correlated) with Triad Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triad Group PLC has no effect on the direction of Silvercorp Metals i.e., Silvercorp Metals and Triad Group go up and down completely randomly.

Pair Corralation between Silvercorp Metals and Triad Group

Assuming the 90 days trading horizon Silvercorp Metals is expected to under-perform the Triad Group. In addition to that, Silvercorp Metals is 1.77 times more volatile than Triad Group PLC. It trades about 0.0 of its total potential returns per unit of risk. Triad Group PLC is currently generating about 0.04 per unit of volatility. If you would invest  27,828  in Triad Group PLC on September 3, 2024 and sell it today you would earn a total of  1,172  from holding Triad Group PLC or generate 4.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Silvercorp Metals  vs.  Triad Group PLC

Silvercorp Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Silvercorp Metals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Silvercorp Metals is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Triad Group PLC

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Triad Group PLC are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Triad Group is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Silvercorp Metals and Triad Group

The main advantage of trading using opposite Silvercorp Metals and Triad Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Silvercorp Metals position performs unexpectedly, Triad Group 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 Triad Group will offset losses from the drop in Triad Group's long position.

The idea behind Silvercorp Metals and Triad Group PLC 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.

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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.