Correlation Between Endeavour Silver and Mammoth Resources

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

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

Diversification Opportunities for Endeavour Silver and Mammoth Resources

0.64

Correlation Coefficient

Endeavour Silver  Mammoth Resources

Poor diversification

The 3 months correlation between Endeavour and Mammoth is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Endeavour Silver Corp and Mammoth Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mammoth Resources Corp and Endeavour 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 Endeavour Silver Corp are associated (or correlated) with Mammoth Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mammoth Resources Corp has no effect on the direction of Endeavour Silver i.e., Endeavour Silver and Mammoth Resources go up and down completely randomly.

Pair Corralation between Endeavour Silver and Mammoth Resources

Assuming the 90 days trading horizon Endeavour Silver Corp is expected to generate 0.28 times more return on investment than Mammoth Resources. However, Endeavour Silver Corp is 3.53 times less risky than Mammoth Resources. It trades about 0.02 of its potential returns per unit of risk. Mammoth Resources Corp is currently generating about 0.0 per unit of risk. If you would invest  569.00  in Endeavour Silver Corp on October 5, 2024 and sell it today you would earn a total of  6.00  from holding Endeavour Silver Corp or generate 1.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Endeavour Silver Corp  vs.  Mammoth Resources Corp

Endeavour Silver Corp

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Endeavour Silver Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Endeavour Silver is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Mammoth Resources Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mammoth Resources Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Mammoth Resources is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Endeavour Silver and Mammoth Resources

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

The idea behind Endeavour Silver Corp and Mammoth Resources 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.

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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.