Correlation Between MINCO SILVER and MGIC INVESTMENT
Can any of the company-specific risk be diversified away by investing in both MINCO SILVER and MGIC INVESTMENT 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 MINCO SILVER and MGIC INVESTMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MINCO SILVER and MGIC INVESTMENT, you can compare the effects of market volatilities on MINCO SILVER and MGIC INVESTMENT 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 MINCO SILVER with a short position of MGIC INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of MINCO SILVER and MGIC INVESTMENT.
Diversification Opportunities for MINCO SILVER and MGIC INVESTMENT
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MINCO and MGIC is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding MINCO SILVER and MGIC INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MGIC INVESTMENT and MINCO SILVER 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 MINCO SILVER are associated (or correlated) with MGIC INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MGIC INVESTMENT has no effect on the direction of MINCO SILVER i.e., MINCO SILVER and MGIC INVESTMENT go up and down completely randomly.
Pair Corralation between MINCO SILVER and MGIC INVESTMENT
Assuming the 90 days trading horizon MINCO SILVER is expected to generate 3.9 times less return on investment than MGIC INVESTMENT. In addition to that, MINCO SILVER is 2.94 times more volatile than MGIC INVESTMENT. It trades about 0.01 of its total potential returns per unit of risk. MGIC INVESTMENT is currently generating about 0.12 per unit of volatility. If you would invest 1,138 in MGIC INVESTMENT on September 29, 2024 and sell it today you would earn a total of 1,162 from holding MGIC INVESTMENT or generate 102.11% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
MINCO SILVER vs. MGIC INVESTMENT
Performance |
Timeline |
MINCO SILVER |
MGIC INVESTMENT |
MINCO SILVER and MGIC INVESTMENT Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MINCO SILVER and MGIC INVESTMENT
The main advantage of trading using opposite MINCO SILVER and MGIC INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MINCO SILVER position performs unexpectedly, MGIC INVESTMENT 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 MGIC INVESTMENT will offset losses from the drop in MGIC INVESTMENT's long position.MINCO SILVER vs. Playa Hotels Resorts | MINCO SILVER vs. Laureate Education | MINCO SILVER vs. Sunstone Hotel Investors | MINCO SILVER vs. InterContinental Hotels Group |
MGIC INVESTMENT vs. GRIFFIN MINING LTD | MGIC INVESTMENT vs. MINCO SILVER | MGIC INVESTMENT vs. MagnaChip Semiconductor Corp | MGIC INVESTMENT vs. Chalice Mining Limited |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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