Correlation Between American Sierra and Adamera Minerals

Can any of the company-specific risk be diversified away by investing in both American Sierra and Adamera Minerals 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 American Sierra and Adamera Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between American Sierra Gold and Adamera Minerals Corp, you can compare the effects of market volatilities on American Sierra and Adamera Minerals 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 American Sierra with a short position of Adamera Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Sierra and Adamera Minerals.

Diversification Opportunities for American Sierra and Adamera Minerals

0.0

Correlation Coefficient

American Sierra  Adamera Minerals

Pay attention - limited upside

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

Pair Corralation between American Sierra and Adamera Minerals

If you would invest  0.50  in American Sierra Gold on December 30, 2024 and sell it today you would lose (0.07) from holding American Sierra Gold or give up 14.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

American Sierra Gold  vs.  Adamera Minerals Corp

American Sierra Gold

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in American Sierra Gold are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile basic indicators, American Sierra reported solid returns over the last few months and may actually be approaching a breakup point.

Adamera Minerals Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Adamera Minerals Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Adamera Minerals is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with American Sierra and Adamera Minerals

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

The idea behind American Sierra Gold and Adamera Minerals Corp 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 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.