Correlation Between Excellon Resources and Silver Bear

Can any of the company-specific risk be diversified away by investing in both Excellon Resources and Silver Bear 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 Excellon Resources and Silver Bear into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Excellon Resources and Silver Bear Resources, you can compare the effects of market volatilities on Excellon Resources and Silver Bear 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 Excellon Resources with a short position of Silver Bear. Check out your portfolio center. Please also check ongoing floating volatility patterns of Excellon Resources and Silver Bear.

Diversification Opportunities for Excellon Resources and Silver Bear

0.0

Correlation Coefficient

Excellon Resources  Silver Bear

Pay attention - limited upside

The 3 months correlation between Excellon and Silver is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Excellon Resources and Silver Bear Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silver Bear Resources and Excellon 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 Excellon Resources are associated (or correlated) with Silver Bear. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silver Bear Resources has no effect on the direction of Excellon Resources i.e., Excellon Resources and Silver Bear go up and down completely randomly.

Pair Corralation between Excellon Resources and Silver Bear

If you would invest  11.00  in Excellon Resources on September 13, 2024 and sell it today you would lose (1.00) from holding Excellon Resources or give up 9.09% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Excellon Resources  vs.  Silver Bear Resources

Excellon Resources

Risk-Adjusted Performance

0 of 100

Insignificant

Over the last 90 days Excellon Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Excellon Resources is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Silver Bear Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Silver Bear Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Silver Bear is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Excellon Resources and Silver Bear

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

The idea behind Excellon Resources and Silver Bear Resources 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 Stocks Directory module to find actively traded stocks across global markets.