Correlation Between Arizona Metals and Polymet Mining

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

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

Diversification Opportunities for Arizona Metals and Polymet Mining

0.0

Correlation Coefficient

Arizona Metals  Polymet Mining

Pay attention - limited upside

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

Pair Corralation between Arizona Metals and Polymet Mining

If you would invest (100.00) in Polymet Mining Corp on December 26, 2024 and sell it today you would earn a total of  100.00  from holding Polymet Mining Corp or generate -100.0% return on investment over 90 days.

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

Arizona Metals Corp  vs.  Polymet Mining Corp

Arizona Metals Corp

Risk-Adjusted Performance

Very Weak

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

Polymet Mining Corp

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Arizona Metals and Polymet Mining

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

The idea behind Arizona Metals Corp and Polymet Mining 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.