Correlation Between Caldas Gold and SilverCrest Metals

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

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

Diversification Opportunities for Caldas Gold and SilverCrest Metals

0.0

Correlation Coefficient

Caldas Gold  SilverCrest Metals

Pay attention - limited upside

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

Pair Corralation between Caldas Gold and SilverCrest Metals

If you would invest  922.00  in SilverCrest Metals on October 23, 2024 and sell it today you would earn a total of  64.00  from holding SilverCrest Metals or generate 6.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.56%
Values	Daily Returns

Caldas Gold  vs.  SilverCrest Metals

Caldas Gold

Risk-Adjusted Performance

0 of 100

Very Weak

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

SilverCrest Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SilverCrest Metals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's essential indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Caldas Gold and SilverCrest Metals

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

The idea behind Caldas Gold and SilverCrest Metals 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.

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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.